Kerala High Court
P.A. Thomas (Died) vs M/S.Southern Housing Corpn Ltd on 25 March, 2025
2025:KER:25141
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE A. BADHARUDEEN
TUESDAY, THE 25TH DAY OF MARCH 2025 / 4TH CHAITHRA, 1947
RFA NO. 175 OF 2003
AGAINST THE DECREE AND JUDGMENT DATED 11.12.2002 IN O.S. NO.668 OF 1994 OF I
ADDITIONAL SUB COURT, ERNAKULAM
APPELLANTS/DEFENDANTS 1,2 & 6 TO 8:
1 P.A. THOMAS (DIED)
AGED 66 YEARS
S/O.LATE P.V.ANTHAPPAN, PULICKAL HOUSE, M.G ROAD, ERNAKULAM. PIN
682016, REPRESENTED BY HIS LEGAL REPRESENTATIVES APPELLANT 3 TO 5.
2 P.A.JOSEPH,
S/O.LATE P.V.ANTHAPPAN, PULIKKAL HOUSE, KARSHAKA ROAD, ERNAKULAM
3 ROSALIND THOMAS,
W/O. LATE P.A.THOMAS, PULICKAL HOUSE, TRIPUNITHURA 682 306.
4 P.T.ANTONY
S/O. LATE P.A.THOMAS, PULICKAL HOUSE, TRIPUNITHURA - 682 306.
5 P.T.PRIYA,
D/O. LATE P.A THOMAS, PULICKAL HOUSE, TRIPUNITHURA 682 306.
(THE CAUSETITLE OF THE APPEAL MEMORANDUM IN RFA 175/2003 IS AMENDED
AS PER ORDER DATED 16/02/2024 IN IA 1/2024)
BY ADVS.
S.R. DAYANANDA PRABHU
K.S.RAJESH
RESPONDENTS/PLAINTIFFS/DEFENDANTS 3 TO 5:
1 M/S.SOUTHERN HOUSING CORPORATION LTD
193, PYCROFTS ROAD, ROYAPETTAH, MADRAS 14 REPRESENTED BY DIRECTOR,
MARIMUTHU.
2 THE COURT RECEIVER,
HIGH COURT, BOMBAY REPRESENTED BY K. MURALIDHARAN AGENT OF COURT
RECEIVER, HIGH COURT BOMBAY IN CIVIL SUIT NO.3337 OF 1995 W.120 3RD
AVENUE, 1ST FLOOR ANNA NAGAR, CHENNAI - 600 040.
3 ARAVIND KUMAR
S/O. GOVINDALU, M.G.ROAD, RAVIPURAM ERNAKULAM.
2025:KER:25141
R.F.A. Nos. 175 & 209 of 2003
2
4 REGINA TOMY,
W/O. TOMY, GIRINAGAR, ERNAKULAM.
5 T.P. TOMY,
S/O. THALIATH PAULOSE, GIRINAGAR, ERNAKULAM.
ADDL R6 INDIA HOUSING FINANCE AND DEVELOPMENT LTD
REP. BY ITS REGIONAL MANAGER, C1-IHFD NAGAR, ADHANUR,
UREAPAKKAM, VANDALUR CHENNAI - 48.
(IMPLEADED AS PER ORDER IN I.A.NO.3653/2005 DATED 31.3.2016)
R1 BY ADVS.
SRI.K.JAYAKUMAR (SR)
SRI.M.SREEKUMAR
R2 BY ADV.
SRI.SAJU S.POONTHODATHU
R3 BY ADV.
SRI.P.R.VENKATESH
R4 & R5 BY ADVS.
SRI.SUNIL N.SHENOI
SRI.P.VISWANATHAN
ADDL.R6 BY ADVS.
SRI.C.S.AJITH PRAKASH
SRI.D.ANIL KUMAR
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 04.03.2025 ALONG
WITH R.F.A. NO.209/2003, THE COURT ON 25.03.2025 DELIVERED THE FOLLOWING:
2025:KER:25141
R.F.A. Nos. 175 & 209 of 2003
3
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE A. BADHARUDEEN
TUESDAY, THE 25TH DAY OF MARCH 2025 / 4TH CHAITHRA, 1947
RFA NO. 209 OF 2003
AGAINST THE DECREE AND JUDGMENT DATED 11.12.2002 IN O.S. NO.668 OF 1994 OF SUB
COURT, ERNAKULAM
APPELLANTS/ADDITIONAL DEFENDANTS 3 TO 5:
1 ARAVIND KUMAR,
S/O. GOVINDALU, RESIDING AT CC 39/4226, M.G. ROAD, RAVIPURAM,
ERNAKULAM, KOCHI-11.
2 REJINA TOMY,
NO. 191, GIRI NAGAR, KOCHI-20.
3 T.P. TOMMY,
S/O. THALIATH POULOSE, NO. 191, GIRI NAGAR, KOCHI-20.
BY ADVS.
P.VISWANATHAN (SR.)
AJITH VISWANATHAN
RESPONDENTS/PLAINTIFFS 1 AND 2 AND DEFENDANT NO.2 & ADDL DEFENDANTS 6 TO 8:
1 SOUTHERN HOUSING CORPORATION LIMITED,
(PREVIOUSLY KNOWN AS IHFD CONSTRUCTIONS LIMITED), 103, PYCROFTS
ROAD, ROYAPETTAH, MADRAS-14, TAMIL NADU, REPRESENTED BY ITS DIRECTOR
(TECHNICAL) MR. K. RAJENDRAN.
2 THE COURT RECEIVER,
HIGH COURT, BOMBAY REPRESENTED BY K. MURALEEDHARAN, AGENT OF COURT
RECEIVER, HIGH COURT BOMBAY IN CIVIL SUIT NO. 3337/1995 W.120, 3RD
AVENUE, 1 FLOOR, ANNA NAGAR, CHENNAI-600040.
3* P.A. JOSEPH,
S/O. LATE P.V. ANTHAPPAN, ANTROSE, PULICKAL HOUSE, KARSHAKA ROAD,
COCHIN-16. [ADDRESS CORRECTED]
*(ADDRESS OF THE 3RD RESPONDENT CORRECTED AS 'P.A.JOSEPH, S/O LATE
D.V.ANTHAPPAN ANTROSE, PULIKAL HOUSE, KARSHAKA ROAD, COCHIN-16' VIDE
ORDER DATED 19.01.2024 IN I.A.NO.2026/2023)
4 ROSELIND THOMAS,
AGED ABOUT 50 YEARS, WIDOW OF P.A. THOMAS, 6/91, PULICKAL HOUSE,
SHRAYAS NAGAR, NEAR KANNAMPUZHA NORTH ROAD, TRIPUNITHURA-682306.
5 P.T. ANTONY,
6/91, PULICKAL HOUSE, SHRAYAS NAGAR, NEAR KANNAMPUZHA NORTH ROAD,
TRIPUNITHURA-682306.
6 P.T. PRIYA,
6/91, PULICKAL HOUSE, SHRAYAS NAGAR, NEAR KANNAMPUZHA NORTH ROAD,
TRIPUNITHURA-682306.
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R.F.A. Nos. 175 & 209 of 2003
4
ADDL R7 JUSTINE MENDEZ
AGED 34, S/O. JOSEPH MENDEZ, RESIDING AT CC 31/88-3B, VYTTILA,
KOCHI-9. (ADDITIONAL R7 IS IMPLEADED AS PER ORDER DATED 21/11/2006
IN IA 4046/2006)
ADDL R8 JOSEPH JACOB (DIED)
S/O JACOB JOSEPH ,CHARTERED ACCOUNTANT ,HOUSE
NO.C.C.58/9275,PAYYANAT HOUSE ,T.D.ROAD ,COCHIN 35
ADDL R9 SUSAN GEORGE
PARATHUVAYALIL ,WORKING IN SREE SANKARA UNIVERSITY COLLEGE OF
SANSKRIT KALADY [ADDITIONAL RESPONDENTS 8&9 IMPLEADED VIDE ORDER
DATED 15/12/2023 IN IA 487/2007]
ADDL R10 P. A.JOSEPH
S/O LATE D.V.ANTHAPPAN ANTHROSE, PULIKKAL HOUSE,KARSHAKA
ROAD ,KOCHIN-16 (ADDL R10 IMPLEADED VIDE ORDER DATED 30.01.2024 IN
I.A. NO.2027/2003)
ADDL R11 LINCY THOMAS
AGED 56, W/O.LATE JOSEPH JACOB, RESIDING AT PAYYANATT HOUSE, HARMONY
ENCLAVE CHILAVANOOR ROAD, KANAYANNUR TALUK ERNAKULAM VILLAGE,
KADAVANTHRA DESOM, KADAVANTHRA P.O., KOCHI, PINCODE - 682020.
ADDL R12 JACOB TOM JOSEPH,
AGED 30, D/O.LATE JOSEPH JACOB, RESIDING AT PAYYANATT HOUSE, HARMONY
ENCLAVE CHILAVANOOR ROAD, KANAYANNUR TALUK ERNAKULAM VILLAGE,
KADAVANTHRA DESOM, KADAVANTHRA P.O., KOCHI, PINCODE - 682020.
ADDL R13 MARYAN JOSEPH
AGED 26, D/O.LATE JOSEPH JACOB, RESIDING AT PAYYANATT HOUSE, HARMONY
ENCLAVE CHILAVANOOR ROAD, KANAYANNUR TALUK ERNAKULAM VILLAGE,
KADAVANTHRA DESOM, KADAVANTHRA P.O., KOCHI, PINCODE - 682020.
ADDL R14 REENA ANNA JOSEPH
AGED 21, D/O.LATE JOSEPH JACOB, RESIDING AT PAYYANATT HOUSE, HARMONY
ENCLAVE CHILAVANOOR ROAD, KANAYANNUR TALUK ERNAKULAM VILLAGE,
KADAVANTHRA DESOM, KADAVANTHRA P.O., KOCHI, PINCODE - 682020.
(LEGAL HEIRS OF DECEASED ADDL .8TH RESPONDENT ARE IMPLEADED AS
ADDITIONAL RESPONDENTS 11 TO 14 VIDE ORDER DATED 16/2/2024 IN IA
1/2024
BY ADVS.
S.R.DAYANANDA PRABHU
M.V.JOHN
RENJU JOHN
B.JAYAPARAKASH
K.S.RAJESH
V.V.ASOKAN (SR.)
S.AMINA
K.V.SOHAN
M.SREEKUMAR
SREEJA SOHAN K.
K.JAYAKUMAR (SR.)
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 04.03.2025 ALONG
WITH R.F.A. NO.175/2003, THE COURT ON 25.03.2025 DELIVERED THE FOLLOWING:
2025:KER:25141
R.F.A. Nos. 175 & 209 of 2003
5
"C.R"
COMMON JUDGMENT
Dated this the 25th day of March, 2025
R.F.A. No.175 of 2003 has been filed by defendants
1 and 2 and additional defendants 6 to 8 in O.S. No.668/1994
on the files of the Sub Court, Ernakulam, under Section 96
read with Order XLI Rule 1 of the Code of Civil Procedure,
1908, challenging the decree and judgment in the above
case dated 11.12.2002. The respondents herein are the
plaintiffs and additional defendants 3 to 5.
2. R.F.A. No.209 of 2003 is also filed challenging the
decree and judgment in O.S. No.668/1994, at the instance
of additional defendants 3 to 5, arraying the plaintiffs and
other defendants as the respondents.
3. Heard the respective senior counsel for the
appellants and the learned counsel appearing for the
respondents, in detail. Also heard the learned counsel for the
additional 9th respondent in I.A. No.1196 of 2005 in R.F.A.
No.209 of 2003, who filed I.A. No.1884/2006 in I.A.
No.1480/2006 in I.A. No.1221/2003 in R.F.A. No.209 of 2003
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R.F.A. Nos. 175 & 209 of 2003
and this Court passed order dated 31.07.2006. Perused the
verdict under challenge and the records of the trial court and
the decisions placed.
4. Parties in these appeals shall be referred with
reference to their status before the trial court.
5. The suit has been filed by the 1 st plaintiff
(originally only one plaintiff, M/s Southern Housing
Corporation Ltd. represented by its Director and
subsequently 2nd additional plaintiff, the Court Receiver also
impleaded) seeking performance of Ext.A2 agreement,
which is, in fact, continuation of Ext.A1 agreement
executed between the 1st plaintiff and defendants 1 and 2.
As per Ext.A1 agreement, it was agreed to sell 178.5 cents
of property for a total sale consideration of Rs.5,750/- per
cent and 180 cents of property for a total consideration of
Rs.7,750/- per cent. Thereafter, Ext.A2 agreement was
executed between the same parties and the covenants
therein read as under:
2. The total sale consideration of the property
is Rs. 18,63,375/- and the sale shall be completed
within 9 months from this date.
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R.F.A. Nos. 175 & 209 of 2003
3. The purchaser shall prepare the plan in
accordance with the rules and regulations of GCDA
or any other competent authorities for promoting
flats at the above said land and shall submit the
papers duly getting signatures from the vendors,
wherever required, to the appropriate authoroties
and all expenses will be borne by the purchaser for
getting approval. The planning permit will be
obtained in 'Vendors' name and shall be transferred
in 'Purchaser' name or its nominees' name as may
be required by the purchaser.
4. The vendors shall sign all the documents
needed, in the 'Purchaser's effort to get the
approval from the authorities concerned and shifting
of transformer if necessary so as to enable the
'Purchaser' to launch the housing projects within
reasonable period.
5. The vendors agree and undertake to give
vacant possession of the said plots and
unequivocally permit the purchaser to proceed with
the development and constructions activities in the
said plots with effect from the date on which this
agreement is entered into between the vendors and
purchasers.
6. The vendors shall agree to register the land
either in parts or in full in favour of the purchasers
or their nominees in proportion to the sale
consideration received from the purchaser from
time to time. The vendors undertakes to obtain all
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R.F.A. Nos. 175 & 209 of 2003
necessary approvals required from Income Tax and
other authorities for the purpose to registration of
the above land.
7. Upon receipt of the entire sale consideration
the vendors agree to give en irrevocable Power of
Attorney to the purchasers if the purchaser so
demand.
8. After discharging Union Bank of India loan,
out of the money received from the purchaser, the
vendors will create mortgage of the above
mentioned property as security to the Purchasers
Bank by way of mortgage so as to enable the
purchaser to get necessary finance for the above
scheme and/or will provide the landed property by
way of security to any housing finance institution as
may be required by the 'Purchaser' for the purpose
of promoting housing scheme at the above
mentioned land.
9. The vendor shall allow the purchaser to
advertise in news-papers for the sale of flats
proposed to be constructed in the above said land
and authorise the purchaser to collect money from
the allottees for promoting the housing scheme.
10. The sale consideration shall be completed
within the period stipulated by the purchaser in
clause 2 otherwise the purchaser shall pay 24%
interest for the money due to the vendors. Similarly
if there is any delay on the part of the Vendors in
discharging their obligation, the vendor shall pay
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R.F.A. Nos. 175 & 209 of 2003
24% interest on the monies received by them till
that date.
6. The 1st plaintiff specifically pleaded in the plaint
that, he has been always ready and willing to execute the
sale deed and according to the 1 st plaintiff, he has paid
Rs.12,01,279/- (i.e. 65% of the total consideration) towards
advance sale consideration on various occasions.
7. Defendants 1 and 2 filed written statement
admitting execution of Exts.A1 and A2 agreements and
denying receipt of Rs.12,01,279/- as advance sale
consideration. According to defendants 1 and 2, the total
amount of advance sale consideration received was
Rs.10,80,000/- as detailed in paragraph No.11 of the
written statement. The specific case of defendants 1 and 2
raised in the written statement is that, the 1 st plaintiff
miserably failed to perform his part of contract and he was
not ready and willing to execute the sale deed.
8. Defendants 3 to 5 also filed written statement
contending that they are bonafide purchasers of the plaint
schedule properties, without knowing the sale agreements
and also the case in between the plaintiffs and defendants
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R.F.A. Nos. 175 & 209 of 2003
1 and 2.
9. The trial court ventured the matter, after raising
necessary issues. PW1 was examined and Exts.A1 to A38
were marked on the side of the plaintiffs. DWs 1 to 3 were
examined and Exts.B1 to B53 were marked on the side of
the defendants. Ext.C1 was also marked as court exhibit.
10. Finally, the trial court granted decree of specific
performance. Now, the said verdict is under challenge.
11. While challenging the verdict of the trial court,
the learned Senior counsel appearing for defendants 1 and
2 and additional defendants 6 to 8, narrated the genesis of
the case based on Exts.A1 and A2 agreements. According
to the learned senior counsel, there was willful negligence
on the part of the 1st plaintiff to execute the sale deed and
in order to buttress this contention, he has pointed out the
attitude of the 1st plaintiff after the execution of Ext.A2
mentioning that, the suit was filed on 25.07.1994, on the
last day of limitation. Thereafter, summons was ordered on
02.08.1994 and for which steps were taken by the plaintiff
only on 22.12.1994. Accordingly, the 1 st defendant received
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R.F.A. Nos. 175 & 209 of 2003
summons on 05.01.1995 and the 2 nd defendant received
summons on 04.01.1995.
12. According to the learned senior counsel for
defendants 1 and 2 and additional defendants 6 to 8, as
could be noticed from Exts.B43 to B53 documents, whereby
defendants 1 and 2 sold the properties in favour of
defendants 3 to 5, all the sale deeds were executed before
01.12.1994 starting from 24.10.1994. Thus, defendants 3 to
5 were not aware of the suit filed, at the time of execution
of Ext.B43 to B53.
13. In addition to that, the learned senior counsel for
defendants 3 to 5 would submit that, on perusal of the body
of the plaint, it could be gathered that, even though the
suit was filed on 25.07.1994, the same was filed without
paying proper court fee and on paying only Rs.2/- as court
fee. Accordingly, the Chief Ministerial Officer noted defect
and returned the plaint, then the plaint was re-presented on
30.07.1994, after curing defects. The point argued by the
learned senior counsel for defendants 3 to 5 is that, the
filing of the plaint in such a manner itself would indicate
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R.F.A. Nos. 175 & 209 of 2003
that the 1st plaintiff was not ready to execute the sale deed
and the 1st plaintiff did not even have money as on
25.07.1994 to pay the court fee for the suit amount. It is
also pointed out that, this attitude of the 1 st plaintiff is to be
read along with dishonor of Exts.B23, B26 and B29 cheques
for a total sum of Rs.6,61,645.25 issued as part of payment
of balance consideration and as per Exts.B24, B27 and B30
dishonor memos issued by Union Bank of India dated
27.02.1993, 25.02.1993 and 20.02.1993 the same got
dishonored with endorsement 'insufficient funds'. According
to the learned senior counsel for defendants 3 to 5, in this
matter, the evidence available would suggest that
defendants 1 and 2 were ready to execute the sale deed in
terms of Ext.A2. But the sale deed could not be executed
because of the laches on the part of the 1st plaintiff.
14. The sum and substance of the contention raised
by the counsel for defendants is that, the 1 st plaintiff was
not ready and willing to execute the sale deed and thereby
its execution could not be materialized, even though
defendants 1 and 2 were ready to execute the same.
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R.F.A. Nos. 175 & 209 of 2003
Another contention raised is that, even otherwise,
defendants 3 to 5 are bonafide purchasers of the plaint
schedule properties for valid consideration and therefore
Exts.B43 to B53 have to be held as sale deeds under the
head 'bonafide purchasers'.
15. The learned senior counsel for defendants 3 to 5
placed decision of the Apex Court reported in [2018 KHC
6786 : ILR 2018 (4) Ker.525] Vijay Kumar and Others
v. Om Prakash, with reference to paragraph Nos. 7 and 8,
to contend that the plaintiff has to prove his readiness and
willingness to perform his part of contract and the
readiness and willingness has to be shown throughout and
has to be established by the plaintiff. Further, the relief of
specific performance is purely discretionary in nature.
Paragraph Nos.7 and 8 reads as under:
7. In order to obtain a decree for specific
performance, the plaintiff has to prove his
readiness and willingness to perform his part of
the contract and the readiness and willingness
has to be shown through out and has to be
established by the plaintiff. In the case in hand,
though the respondent -plaintiff has filed the suit
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R.F.A. Nos. 175 & 209 of 2003
for specific performance on 29th April, 2008, the
respondent plaintiff has not shown his capacity
to pay the balance sale consideration of
Rs.22,00,000 (Rupees Twenty Two Lakhs). In his
evidence, the respondent - plaintiff has stated
that he has borrowed the amount from his
friends and kept the money to pay the balance
sale consideration. As rightly pointed out by the
Trial Court, the respondent - plaintiff could not
produce any document to show that he had the
amount of Rs.22,00,000 (Rupees Twenty Two
Lakhs) with him on the relevant date; nor was he
able to name the friends from whom he raised
money or was able to raise the money. Further
more, as rightly pointed out by the Trial Court,
the respondent - plaintiff could have placed on
record his Accounts Book, Pass Book or the
Statement of Accounts or any other negotiable
instrument to establish that he had the money
with him at the relevant point of time to perform
his part of the contract. We are, therefore, in
agreement with the view taken by the Trial Court
that the respondent - plaintiff has not been able
to prove his readiness and willingness on his
part.
8. The relief for specific performance is
purely discretionary. Though the respondent -
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R.F.A. Nos. 175 & 209 of 2003
plaintiff has alleged that he was ready and
willing to perform his part of the contract, the
First Appellate Court ought to have examined
first whether the respondent - plaintiff was able
to show his capacity to pay the balance money.
In our considered view, the First Appellate Court
as well as the High Court has not properly
appreciated the evidence and the conduct of the
parties. The First Appellate Court as well as the
High Court, in our view, was not right in
reversing the judgment of the Trial Court and the
impugned order cannot be sustained and liable
to be set aside.
16. Another decision of this Court in Rafeeq v.
Abdul Bari reported in [2018 (2) KHC 276 : 2018 (2)
KLJ 530] also has been highlighted, with reference to
paragraph No.16, wherein it has been held that, Clause (c)
of S.16 of the Specific Relief Act, 1963, lays down the
conditions precedent to the enforcement of specific
performance of a contract. S.16(c) of the Act is couched in
a negative form. It mandates that specific performance of a
contract cannot be enforced in favour of a person who has
failed to aver and prove his readiness and willingness to
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R.F.A. Nos. 175 & 209 of 2003
perform his part of the contract. A bare perusal of this
provision shows that the plaintiff has the obligation not only
to aver that he has always been ready and willing to
perform the essential terms of the contract but also to
prove so. The basic principle behind S.16(c) of the Act read
with Explanation (ii) is that any person seeking the benefit
of specific performance of contract must manifest that his
conduct has been blemishless throughout, entitling him to
the specific relief (Aniglase Yohannan v. Ramlatha, 2005
KHC 1419 : AIR 2005 SC 3503: 2005 (7) SCC 534: 2005 (4)
KLT 280).
17. Another decision of the Apex Court reported in
[2022 KHC 6698 : 2022 KHC OnLine 6698]
Krishnamurthy (Since Deceased) Thr. Mrs. U.N. v.
A.M. Krishnamurthy, has been placed by the learned
counsel for defendants 3 to 5, with reference to paragraph
Nos.47 and 48 to assert the point that, deposit of any
amount in court at the Appellate stage by the plaintiff by
itself could not establish his readiness and willingness to
perform his part of the contract within the meaning of
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R.F.A. Nos. 175 & 209 of 2003
Section 16(c) of the Specific Relief Act. Paragraph Nos. 47
and 48 reads as under:
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 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 S. 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
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R.F.A. Nos. 175 & 209 of 2003
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 S.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 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.
18. It is argued by the learned counsel for defendants
1 and 2 that, as per Ext.A33 balance statement of the 1 st
plaintiff company, the balance outstanding as per schedule
No.3 is shown as only Rs.3,45,389/- at hand and
Rs.1,69,324/- at the bank account and the same would
show that the 1st plaintiff did not have means to pay the
balance consideration to execute the sale deed, during the
relevant time.
19. The learned counsel for additional respondent
No.9 in I.A. No.1196 of 2005, who filed I.A. No.1884/2006 in
I.A. No.1480/2006 in I.A. No.1221/2003 in R.F.A. No.209 of
2025:KER:25141
R.F.A. Nos. 175 & 209 of 2003
2003, also supported the arguments raised by the learned
senior counsel for defendants 3 to 5, on the assertion that
the status of additional respondent No.9 in I.A. No.1196 of
2005 in R.F.A. No.209 of 2003 is similar to that of
defendants 3 to 5 being bonafide purchaser. Therefore, his
right also be protected.
20. In response to this argument, the learned counsel
for the 1st plaintiff would submit that, as far as additional
respondent No.9 is concerned, when there is an interim
injunction order was passed by this Court as per order
dated 20.06.2006 in I.A. No.1480/2006, the additional
respondent No.9 filed I.A. No.1884/2006 to modify the order
dated 20.06.2006 in I.A. No.1480/2006 and he obtained
permission to continue the construction in the plot which do
form part of the plaint schedule properties, by filing
affidavit to the effect that "I hereby undertake that if I am
allowed to proceed with the construction, I will not claim
any value of improvements from the plaintiff or any
equitable relief against the plaintiff. I also make it clear that
further constructions I make is at my risk and cost" .
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R.F.A. Nos. 175 & 209 of 2003
Therefore, no protection is available to additional
respondent No.9 in I.A. No.1196 of 2005.
21. The learned counsel for the 1 st plaintiff referred
the vital documents including Exts.A1 and A2 as well as A7
to A10, A13, A15 to A17, A19, Exts.A29 and A33 to A35 to
contend that the 1st plaintiff has been ready and willing to
perform their part of the contract and the same could not
be materialized because of the reluctance on the part of
defendants 1 and 2, in complying the conditions in the sale
agreements, viz. obtaining Tax clearance Certificate as
mandated under Section 230 of the Income Tax Act, then in
force. Further, they also failed to remove the transformer
and evict the tenants in time. It is pointed out by the
learned counsel for the 1st plaintiff further that, periodically
there was communication in between the 1 st plaintiff and
defendants 1 and 2 and the bonafides of the 1 st plaintiff to
execute the sale deed could be gathered from the said
documents.
22. It is pointed out by the learned counsel for the 1 st
plaintiff further that, in a suit for specific performance,
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R.F.A. Nos. 175 & 209 of 2003
cancellation of subsequent documents are not necessary
and he has placed reliance on the decision of the Apex
Court reported in [2022 KHC 6401 : 2022(3) KHC SN 15]
Ramasubbamma P. v. V. Vijayalakshmi and Others ,
with reference to paragraph No.5 and submitted that, in
the instant case, grant of discretionary relief of specific
performance by the trial court is to be justified following the
ratio in the above decision. Paragraph No.5 reads as under:
Considering the fact that original
defendant No. 1 - vendor - original owner
admitted the execution of agreement to sell
dated 12/04/2005 and even admitted the
receipt of substantial advance sale
consideration, the learned Trial Court decreed
the suit for specific performance of
agreement to sell dated 12/04/2005. Once
the execution of agreement to sell and the
payment/receipt of advance substantial sale
consideration was admitted by the vendor,
thereafter nothing further was required to be
proved by the plaintiff - vendee. Therefore, as
such the learned Trial Court rightly decreed
the suit for specific performance of
agreement to sell. The High Court, was not
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R.F.A. Nos. 175 & 209 of 2003
required to go into the aspect of the
execution of the agreement to sell and the
payment/receipt of substantial advance sale
consideration, once the vendor had
specifically admitted the execution of the
agreement to sell and receipt of the advance
sale consideration; thereafter no further
evidence and/or proof was required.
it is also required to be noted that on
appreciation of evidence, the learned Trial
Court has specifically given the finding that
the alleged sale consideration paid by
defendant Nos. 3 and 4 to original defendant
No. 2 for executing sale deeds dated
03/05/2010 have not been established and
proved by defendant Nos. 2 to 4. Therefore,
there was a specific finding given by the
learned Trial Court on appreciation of
evidence that sale deeds dated 03/05/2010
were nominal sale deeds. The High Court has
brushed aside the same on the ground that
even in agreement to sell dated 12/04/2005,
the amount was alleged to have been paid by
cash. However, it is required to be noted that
so far as receipt of substantial advance sale
consideration mentioned in the agreement to
sell dated 12/04/2005 has been specifically
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R.F.A. Nos. 175 & 209 of 2003
admitted by defendant No. 1. Therefore,
when it was specifically alleged that
defendant No. 2 executed sale deeds in
favour of defendant Nos. 3 and 4, who are his
sisters-in-law, with a view to defeat the rights
of the plaintiff and defendant No. 1 and when
it was alleged that they were nominal sale
deeds, thereafter, defendant No. 2 was
required to prove the receipt of sale
consideration mentioned in the sale deeds
dated 03/05/2010, which defendant Nos. 2 to
4 have failed to do so.
23. Similarly, another decision of the Apex Court
reported in [2019 KHC 6577 : 2019 (6) SCC 233]
Beemanenimaha Lakshmi v. Gangumalla Appa Rao
(since dead) by legal representatives , has been placed
by the learned counsel for the 1 st plaintiff with reference to
paragraph No.10, to buttress his argument. Paragraph
No.10 reads as under:
Therefore, on conjoint reading of Ex. A1 and
the reply to the notice by the defendant dated
14.04.1987 and the cross examination of the
defendant - vendor, both the learned trial Court and
the High Court have rightly observed and held that
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R.F.A. Nos. 175 & 209 of 2003
it was the appellant vendor that did not perform her
part of the contract. Once, the finding is recorded
that it was the appellant - vendor that did not
perform her part of the contract, thereafter as
rightly observed by the High Court, the failure on
the part of the vendee to "demonstrate" that he
was having sufficient money with him to pay the
balance sale consideration under Ex. A1 by the date
of his evidence is not much of consequence. Even
otherwise, it is required to be noted that the
plaintiff deposited the entire balance sale
consideration as directed by the learned trial Court
within the extended period of time. It is required to
be noted that as it was submitted on behalf of the
defendant before the learned trial Court that the
plaintiff does not have any capacity to pay the
balance sale consideration, to test his bona fides
the learned trial Court directed the plaintiff to
deposit the balance sale consideration which the
plaintiff did deposit. Merely because the said
amount was deposited out of the fund /amount
received by him by selling the property in the year
1993, by that itself cannot be presumed and / or
inferred that at the time of execution of the
agreement to sell and / or thereafter even at the
time of the notice, the plaintiff was not having
sufficient fund to pay the balance sale
consideration. It is required to be noted that an
agreement to sell is dated 30.12.1985 and the
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R.F.A. Nos. 175 & 209 of 2003
plaintiff was directed to deposit the amount in the
year 1993. It is not expected from the plaintiff that
he would continue to deposit the same with the
bank all these years. What is required to be
considered is as and when he is called upon to
make the deposit, he has deposited the amount to
show his bona fides or not? Therefore, as such, both
the learned trial Court as well as the High Court
have rightly passed a decree for specific
performance.
24. Apart from that, he has placed decision of the
Apex Court reported in [2023 ICO 885] Gaddipati Divija
& Anr v. Pathuri Samrajyam & Ors , with reference to
paragraph No.30, wherein the Apex Court held as under:
30. In light of the aforementioned Aniglase
Yohannan judgment (supra), and as held by the
High Court, the primary requirement to seek
relief under Section 16(c) of the Act is that the
Plaintiff was ever ready and willing to perform
his part of the contract. It is clear from the facts
of the case at hand that the Plaintiff (Respondent
No.1 herein) was ever ready and willing to pay
the balance sale consideration. In the sale
agreement, it was clearly mentioned that within
three months the deceased G. Venugopala Rao
will get the suit schedule property measured and
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R.F.A. Nos. 175 & 209 of 2003
demarcated and the Plaintiff (Respondent No.1
herein) shall pay the balance sale consideration.
It appears that, at first, the deceased G.
Venugopala Rao while agreeing to sell 90 cents
of land, concealed that he is the owner of only
50 cents of the land. Subsequently, he failed to
measure and demarcate the land. On the other
hand, the Plaintiff (Respondent No.1 herein),
from the outset, has been clear and blemishless
in his conduct. She had paid the advance sale
consideration of Rs.4,00,000/-. When the
deceased G. Venugopala Rao failed to measure
and demarcate the land, the question of the
Plaintiff (Respondent No.1 herein) paying the
balance sale consideration does not arise.
However, even then the averments of the
Plaintiff, her conduct and the testimony of her
husband show that the Plaintiff, since the signing
of the sale agreement, was ever ready and
willing to pay the balance consideration.
25. It is pointed out by the learned counsel for the 1 st
plaintiff by placing decision of the Apex Court reported in
[2021 KHC 6649 : 2021 KHC OnLine 6649] Sughar
Singh v. Hari Singh (dead) through LRs. and Others ,
that when substantial portion of sale consideration has
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R.F.A. Nos. 175 & 209 of 2003
been paid and the vendee specifically stated in his
pleadings and evidence that he has been ready and willing
to execute the sale deed, no finding that vendee was not
having no means to generate consideration could be found,
with reference to paragraph No.6.1. In Paragraph No. 6.1,
after referring an earlier decision reported in [(1999) 6
SCC 337] Syed Dastagir v. T.R. Gopalakrishna Setty ,
the Apex Court observed as under:
6.1. 9. So the whole gamut of the issue
raised is, how to construe a plea specially with
reference to S.16(c) and what are the
obligations which the plaintiff has to comply
with in reference to his plea and whether the
plea of the plaintiff could not be construed to
conform to the requirement of the aforesaid
section, or does this section require specific
words to be pleaded that he has performed or
has always been ready and is willing to perform
his part of the contract. In construing a plea in
any pleading, courts must keep in mind that a
plea is not an expression of art and science but
an expression through words to place fact and
law of one's case for a relief. Such an expression
may be pointed, precise, sometimes vague but
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R.F.A. Nos. 175 & 209 of 2003
still it could be gathered what he wants to
convey through only by reading the whole
pleading, depending on the person drafting a
plea. In India most of the pleas are drafted by
counsel hence the aforesaid difference of pleas
which inevitably differ from one to the other.
Thus, to gather true spirit behind a plea it
should be read as a whole. This does not
distract one from performing his obligations as
required under a statute. But to test whether he
has performed his obligations, one has to see
the pith and substance of a plea. Where a
statute requires any fact to be pleaded then
that has to be pleaded maybe in any form. The
same plea may be stated by different persons
through different words; then how could it be
constricted to be only in any particular
nomenclature or word. Unless a statute
specifically requires a plea to be in any
particular form, it can be in any form. No
specific phraseology or language is required to
take such a plea. The language in S.16(c) does
not require any specific phraseology but only
that the plaintiff must aver that he has
performed or has always been and is willing to
perform his part of the contract. So the
compliance of "readiness and willingness" has
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R.F.A. Nos. 175 & 209 of 2003
to be in spirit and substance and not in letter
and form. So to insist for a mechanical
production of the exact words of a statute is to
insist for the form rather than the essence. So
the absence of form cannot dissolve an essence
if already pleaded."
26. The learned counsel for the plaintiff also placed
decision of the Apex Court reported in [2020 KHC 6552 :
2020 (5) KLT 645] Santoshamma B. and Another v.
Sarala D. and Another. In paragraph No.87 of the
decision it has been held as under:
87. S.12 of the SRA is to be construed and
interpreted in a purposive and meaningful
manner to empower the Court to direct specific
performance by the defaulting party, of so
much of the contract, as can be performed, in a
case like this. To hold otherwise would permit a
party to a contract for sale of land, to
deliberately frustrate the entire contract by
transferring a part of the suit property and
creating third party interests over the same.
27. In view of the rival submissions the points arise
for consideration are:
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R.F.A. Nos. 175 & 209 of 2003
1. Whether the finding of the trial court that
the suit is not barred by limitation is correct?
2. Whether the finding of the trial court that
the plaintiff has been ready and willing to
execute Ext.A2 sale agreement, in continuation
of Ext.A1 is erroneous?
3. Whether the contention raised by
defendants 1 and 2 to the effect that they are
ready and willing to execute the sale deed and
the same could not be executed because of the
laches of the plaintiff is sustainable?
4. Whether the claim raised by defendants
3 to 5 as well as additional respondent No.9 in
I.A. No.1196 of 2005 in R.F.A. No.209 of 2003
would succeed treating them as bonafide
purchasers?
5. Whether the decree and judgment of the
trial court would require interference?
6. Reliefs and cost.
28. In addition to the documents marked by the trial
court, two commission reports dated 24.06.2005 and
20.06.2006 were obtained by this Court also marked as
Exts.C2 and C3.
29. Point No.1:- In this case, defendants 1 and 2
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R.F.A. Nos. 175 & 209 of 2003
raised contention that the suit is barred by limitation. The
trial court addressed the same and answered in favour of
the 1st plaintiff, holding that the suit is not barred by
limitation. In fact, the question of limitation is argued
before this Court also, on the premise that the date of the
agreement as per Ext.A2 is 21.10.1990 referring the date
shown in Ext.B2, a duplicate copy of Ext.A2. The learned
counsel for defendants 1 and 2 brought out the dates in
Ext.B2 and Ext.A2 to assert that the suit is barred by
limitation. But, it is perceivable from Ext.A2 that, without
any correction and over writing the date of agreement is
stated as 25.10.1990 therein and not 21.10.1990, as
contended by defendants 1 and 2, as written in Ext.B2,
after erasing the earlier entry. Since the suit has been filed
as on 25.07.1994, the same is well within the period of
limitation, where the time for the execution of the sale
deed was fixed within nine months from the date of
execution of Ext.A2. Therefore, the finding of the trial court
that the suit is not barred by limitation is only to be
confirmed. In view of this finding, the initial filing of the suit
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R.F.A. Nos. 175 & 209 of 2003
without paying sufficient court fee, its return for curing the
defect and its re-presentation thereafter have no legal
consequences.
30. Point Nos.2 to 6:- In this matter, the 1 st plaintiff is
M/s Southern Housing Corporation Ltd represented by its
Director. According to the 1 st plaintiff, pursuant to execution
of Ext.A2 in continuation of Ext.A1 agreement, 65% of the
total consideration to the tune of Rs.18,63,375/- i.e.
Rs.12,01,279/- was paid to defendants 1 and 2 on various
occasions. The contention raised by the defendants 1 and 2
is that, the amount paid as advance was Rs.10,80,000/-
only. While addressing this dispute, the trial court relied on
the evidence of PW1 supported by Exts.A1, A2, A3, A7, A10,
A17, A26, A33 to A37 as well as Exts.B3 and B4 letters
issued by the 1st plaintiff to defendants 1 and 2. Apart from
that, Exts.B10, B23, B26 and B29 were also relied by the
trial court. Accordingly, the trial court found that, Exts.A1
and A2 would reveal that Rs.4,00,000/- was paid by way of
cheques. As per Ext.A3 letter dated 13.10.1990, the 1 st
plaintiff requested defendants 1 and 2 not to present the
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R.F.A. Nos. 175 & 209 of 2003
cheque before Ext.A2. Ext.A7 and A10 would reveal that
Rs.3.75 lakhs was deposited in Union Bank of India. Ext.A26
would reveal that Rs.30,000/- was paid on 26.11.1991 by
D.D. Admittedly Rs.75,000/- paid on 25.10.1991 and
Rs.2,00,000/- by cheque paid on 14.8.1992. Ext. A33 to A37
are the annual report of the 1 st plaintiff company during
1988 to 1990 which would reveal that the 1 st plaintiff had
substantial assets to pay off the entire balance
consideration. Ext.B3 letter dated 10.2.1990 and Ext.B4
letter dated 10.3.1990 addressed to defendants would
reveal that there was offer and demand for payment of
Rs.5,00,000/- prior to execution of Ext.A2. Ext.B10 is the
letter dated 17.12.1991 demanding to send the amount by
D.D. Ext.B23, B26 and B29 are the cheques for
Rs.2,00,000/- each and Rs.2,61,645.25 drawn on
5.11.1992, 23.11.1992 and 10.12.1992 respectively in
favour of defendants 1 and 2. These cheques returned
dishonoured for the reason 'funds insufficient' evident by
the dishonour memos dated 27.2.1993, 4.3.1993,
25.2.1993, 5.3.1993, 20.2.1993 and 27.2.1993 marked as
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R.F.A. Nos. 175 & 209 of 2003
Ext.B24, 25, 27, 28, 30, 31 respectively. Ext.B19 is the
letter dated 26.11.1992 informing dishonour. Ext.B32 to 34
and B20 are the acknowledgment cards. It was thereafter
that defendants 1 and 2 issued letter dated 13.11.1993,
rescinding the contract evidenced by Ext.B35. Ext.B36 and
37 are the postal articles pertaining to Ext.B35. Ext. B21
letter dated 5.12.1992 issued to the 1 st plaintiff by
defendants 1 and 2, as a last reminder. B22 is the postal
acknowledgment.
31 Finally, the trial court found that the amount paid
as advance would come to Rs.12,01,279/- and not
Rs.10,80,000/- as contended by defendants 1 and 2. On
perusal of the documents along with payment made by the
1st plaintiff to defendants 1 and 2, the said finding appears
to be convincing. Therefore, payment of Rs.12,01,279/-
(65% of the total consideration) by the 1 st plaintiff as the
advance amount, as found by the trial court, is only to be
confirmed.
32. Ext.B35 is a document for which much reliance
has been given by the learned counsel appearing for
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R.F.A. Nos. 175 & 209 of 2003
defendant Nos.1 and 2, to contend that as on 13.11.1993,
the 1st defendant issued a letter to the Director of the 1 st
plaintiff Corporation stating that since the 1 st plaintiff
miserably failed to act as agreed, the agreement, actions,
proceedings and commitments in respect of the entire land
transactions stood cancelled by the conduct of the 1 st
plaintiff and by the inability to pay the entire sale
consideration. According to the learned counsel for
defendants 1 and 2, in view of Ext.B35 letter, reluctance on
the part of the 1st plaintiff to execute the sale deed could be
seen.
33. Repelling this contention, the learned counsel for
the 1st plaintiff argued that, there was no reluctance on the
part of the 1st plaintiff in the matter of execution of the sale
deed, since they have already paid 65% of the total sale
consideration as advance and had sufficient means to pay
the balance consideration. It is pointed out that, in respect
of the total extent of property offered to be sold,
defendants 1 and 2 failed to obtain Tax Clearance
Certificate as mandated under Section 230 of the Income
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R.F.A. Nos. 175 & 209 of 2003
Tax Act, then in force. According to him, as per Exts.A34
and 35, there was sufficient balance in the account of the
1st plaintiff company to purchase the property and the sale
deed could not be executed because of the reluctance on
the part of defendants 1 and 2, in complying the conditions
in the agreement, inclusive of removal of transformer and
eviction of the tenants from the property. Even though, the
learned counsel for defendants 1 and 2 was asked to justify
as to whether the Tax Clearance Certificate as mandated
under Section 230 of the Income Tax Act then in force,
obtained in respect of the entire extent of the plaint
schedule property, he could not point out such Tax
Clearance Certificate for the whole plaint schedule property.
It is relevant to note that, as per Ext.B43 to B53
documents, the plaint schedule properties were sold in
piece meal to avoid the mandate of getting Income Tax
Certificate. The same would show that defendants 1 and 2
failed to obtain Tax Clearance Certificate in respect of the
entire property, despite having done something with regard
to the other conditions belatedly and also obtaining Tax
2025:KER:25141
R.F.A. Nos. 175 & 209 of 2003
Clearance Certificate in relation to 107.408 cents of
property. So, without obtaining Tax Clearance Certificate as
mandated under Section 230 of the Income Tax Act, the
sale deed could not be executed in respect of the entire
property. If so, reluctance on the part of defendants 1 and 2
is to be found in the matter of execution of the sale deed.
34. Even though, as per schedule No.3 in Ext.A33
balance statement of the 1 st plaintiff company, the balance
outstanding is shown as only Rs.3,45,389/- at hand and
Rs.1,69,324/- at the bank account, as pointed out by the
learned counsel for the 1 st plaintiff, Exts.B33 to B37 annual
report of the 1st plaintiff company would show that it has
substantial assets to pay off the entire consideration.
Moreover, the 1st plaintiff company paid an amount of
Rs.1,00,000/- each by way of cheque dated 26.5.1988 and
13.10.1988 in favour of defendants 1 and 2 respectively. A
cheque for Rs.2,00,000/- was drawn in favour of 2 nd
defendant on 6.11.1990. An amount of Rs.3,75,000/- was
remitted by the plaintiff company in Union Bank of India,
Perumannoor on 11.4.1991. An amount of Rs.75,000/-was
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R.F.A. Nos. 175 & 209 of 2003
remitted on 25.10.1991. The 2 nd defendant also received an
amount of Rs.30,000/- on 26.11.1991 and Rs.2,00,000/- on
14.8.1992. Thus, altogether defendants 1 and 2 received an
amount of Rs.12,01,279/- as already found. It is true that
the plaintiffs issued 3 cheques on 5.11.1992, 23.11.1992
and 10.12.1992 for an amount of Rs.2,61,645.25. But the
cheques were dishonoured for the reason insufficiency of
funds. Thus, it has to be held that, even without obtaining
Tax Clearance Certificate in respect of the whole plaint
schedule properties, the sale deed in respect of the
properties could not be executed and the same is the
reason for non execution of the same.
35. It is true that, as per Exts.B43 to B53, the
properties were sold prior to getting notice to defendants 1
and 2 in the suit. But the said period also is within the
period of limitation to execute Ext.A2. Therefore, mere non
receipt of summons in a suit by itself would not justify
execution of Exts.B43 to B53 sale deeds in favour of
defendants 3 to 5 by defendants 1 and 2, since the suit has
been filed within the period of limitation.
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R.F.A. Nos. 175 & 209 of 2003
36. It is relevant to note that, one among the
conditions to be satisfied by defendants 1 and 2 to execute
sale deed in respect of plaint schedule properties is clearing
off the liability with the Union Bank of India. In paragraph
Nos.22 to 23 of the judgment, the trial court considered the
readiness and willingness on the part of the 1 st plaintiff to
execute the sale deed. Paragraph Nos. 22 and 23 reads as
under:
22. Then the question is as to whether
the plaintiff has ever been ready and willing to
take the sale deed on the strength of Ext. A1
and 2. As enlightened by the learned counsel
for the plaintiff the court should look into the
totality of of the circumstances, the conduct of
parties and the allegations in the plaint to
come to a conclusion in this regard. Under
Sec.16(c) of the Specific Relief Act any person
seeking for specific performance of the
contract has to plead and prove his readiness
and willingness to perform his part of contract.
PW1 would depose that the defendants did not
comply with the terms and conditions to Ext.A2
in time and that there was inordinate delay in
handing over vacant possession by removing
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R.F.A. Nos. 175 & 209 of 2003
the transformer and by evicting the tenants.
They did not measure out the properties nor
did they release mortgage and to obtain title
deeds from the Union Bank of India. They did
not care to verify the draft sale deed no did
they obtain the incometax clearance certificate
in time. DW1 on the other would say that the
plaintiff could not take the sale deed due to
paucity of funds, But they could obtain permit
for construction even without the removal of
the transformer. Ext.B35 is the letter dt.
13.11.93, addressed to plaintiff intimating that
the Ext.A2 stands cancelled by non-
performance. Ext.A36 and 37 are the postal
articles which would reveal that there was
proper notice. Infact plaintiff sent no reply to
Ext. B35. Either sides produced a series of
letters of correspondence to show that Ext.A1
and A2 fell out not due to their fault.
Admittedly, the plaintiff engaged in housing
flat construction and Ext. A1 and A2 would
reveal that plaint schedule was intended to be
purchased for that purpose. Ext.A2 would
further reveal that there is a transformer
situate in plaint schedule.
23. Ext.B5 is the letter dt. 22.2.90
addressed to the plaintiff which would reveal
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R.F.A. Nos. 175 & 209 of 2003
that the defendants have applied for shifting
the transformer and the hightension power
lines crossing the property towards the
northern boundary of the plaint schedule to
facilitate the construction of the a building. And
the plaintiff was requested to give a no-
objection certificate to the KSEB for that
purpose. It was thereafter that the parties have
entered into Ext.A2 agreement stipulating the
removal of the transformer by the defendants.
Had the case set up by the defendants that
they applied for removal of the transformer
sufficiently earlier true it would not have
incorporated in Ext.A2. And Ext. A4 is the letter
dt. 29.10.90 addressed to the defendants by
the plaintiff requesting them to shift the
transformer expeditiously as possible. It was
followed by Ext.B6 the letter dt. 1.3.91,
addressed the plaintiff in which he was
requested to apply for shifting of the
transformer in accordance with the sketch
appended to in Ext.B5 and to issue NOC to
KSEB. Infact no sketch appended to Ext.B5.
Ext.A19 is the letter dt. 22.10.92, issued to
defendants 1 and 2 which would reveal that so
far the defendants did not apply for shifting the
transformer. Ext. A20 is the letter dt. 27.7.93
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R.F.A. Nos. 175 & 209 of 2003
addressed to the 2nd defendant by the plaintiff,
which would reveal that the transformer still
remained in the properties. DW1 would depose
that he signed all papers to apply for shifting of
the transformer and that the plaintiff could
obtain sanction without its removal. The fact
that it is one of the obligations cast upon D1
and 2 as per Ext.A2 not disputed. Testimony of
DW1 and Ext.A2, 4, 19, 20 and Ext.B5 and 6
would reveal that the defendants did not
succeed to shift the transformer in time within
the period stipulated in Ext.A2. DW2 is the
addl. 5th defendant and he would depose that
at the time when he purchased the plaint
schedule the transformer was standing on the
western side by the side of road. DW3 is the
addl. 3rd defendant and would depose that
there was no transformer in the property which
ofcourse cannot be believed even for a
moment.
37. It was found by the trial court further that,
admittedly there were four tenants occupying the plaint
schedule properties at the time of Ext.A2 and as per Ext.A5
letter dated 20.11.1990, the 1st plaintiff demanded the 2nd
defendant to make arrangements for vacating the tenants
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R.F.A. Nos. 175 & 209 of 2003
and to handover the possession of the plaint schedule
properties. In reply to the same, Ext.A6 letter dated
23.11.1990 was issued by the 1 st plaintiff and the same
would show that, when the architect of the 1 st plaintiff
company visited the property to survey the property, the
tenants obstructed the same. Thereafter, Ext.A9 letter, it
was informed by the defendants to the 1st plaintiff that the
tenants would be evicted within 15 to 20 days. In fact,
Ext.A2 provides for vacant possession within nine months.
But, the evidence of PW1 supported by Exts.A6, A9, A12,
A26, B8 and B9 would show that the tenants were evicted
only after one year. Thereafter, as evident from Ext.A23 and
A24 letters dated 07.07.1993 and 15.07.1993, that the 1 st
plaintiff had proposed to depute two watchmen to the
plaint schedule properties to protect the building site.
Anyhow, as per the available evidence, the tenants were
not vacated by defendants 1 and 2, within nine months, as
agreed.
38. Regarding the liability with the Union Bank of
India, Ext.A29 is a letter dated 13.11.1990 issued by the 2 nd
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R.F.A. Nos. 175 & 209 of 2003
defendant to the 1st plaintiff and the same would show that
when the parties have met in Madras and discussed about
the liability to the bank, defendants 1 and 2 had assured to
offer the plaint schedule properties as security and
requested the 1st plaintiff to clear off the liability. As per
Ext.A8 letter dated 21.02.1991 addressed to Union Bank of
India, the 1st defendant requested that his financial position
was unsafe and he agreed to pay Rs.3.5 Lakh only towards
the loan liability.
39. According to the learned counsel for the 1 st
plaintiff, instead of closing the loan liability by repaying the
amount due to the Bank, as per Ext.A8 defendants 1 and 2
requested the Bank to reduce the amount substantially and
bargained to reduce the amount and thereby delayed the
execution of the sale deed. As per Ext.A12 letter dated
28.05.1991, it was revealed that defendants 1 and 2 not
only failed to release the title deeds, but also failed to
deposit the amount in the Bank to facilitate the 1 st plaintiff
to avail loan as agreed upon in Ext.A2 with a warning to
invoke the default clause in Ext.A2. Anyhow, as on
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25.10.1991, as per Ext.B7 letter, issued to Union Bank of
India, there was acknowledgment regarding receipt of title
deed by the 1st plaintiff. Thus, it appears that at a later
stage, the liability was cleared with Union Bank of India and
the original title deed of the plaint schedule properties was
entrusted to the 1st plaintiff.
40. Regarding the Tax Clearance Certificate from the
authorities to facilitate the registration of sale deed and
also to execute an irrevocable power of attorney to the 1 st
plaintiff for the purpose of further transaction, if so required
by him, are concerned, Ext.A15 letter dated 04.05.1992,
the 1st plaintiff requested defendants 1 and 2 to arrange the
Income Tax Clearance Certificate. As per Ext.A28 dated
13.03.1992 addressed to the 1 st plaintiff by defendants 1
and 2, they assured to sent the power of attorney for
phases 1 and 2 out of plaint schedule along with draft sale
deed before 30.03.1992. They acknowledged the receipt of
Rs.8.80 lakhs and requested for payment of the balance
consideration. Ext.B11 is the letter dated 4.5.1992,
addressed to the defendants by the 1 st plaintiff in which it
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R.F.A. Nos. 175 & 209 of 2003
was informed that the 1st plaintiff should complete the
transaction by 15.5.1992 and they were requested to
arrange the income tax clearance certificate. Ext.A13 is the
previous letter dated 20.12.1991 issued for the same
purpose. It was followed by Ext.B12, the letter dated
10.5.1992 issued to the plaintiff in reply to Ext.B11 in which
the defendants requested for draft sale deed for submitting
application for Income Tax Clearance Certificate. It would
further reveal that the defendants 1 and 2 have also
received draft power of attorney, but they were awaiting for
the bill of balance sale consideration, and to comply with
the same before 15.5.1992. Ext.B13 and 14 are the Income
Tax Clearance Certificates dated 23.6.1992 and 25.6.1992
issued in the name of the defendants for alienation of
107.408 cents in Sy.624/1, 623, 1, 2 and 7 of Elamkulam
Village. Ext.B15 is the letter dated 13.7.1992, issued to the
1st plaintiff informing the receipt of Ext. B13 and 14.
Ext.A16 is the letter dated 8.9.1992, addressed to the
defendants 1 and 2 by the 1 st plaintiff requesting to send
the income tax clearance certificate of phase 1 and 2 by
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R.F.A. Nos. 175 & 209 of 2003
return post and to arrange the income tax clearance for 3 rd
phase to be sent before 19.9.1992. Ext.B18 is the telegram
dated 15.10.1992 from the defendants 1 and 2 to the 1 st
plaintiff which was sent as a reminder that the income tax
clearance would expire on 22.10.1992. Ext.A17 is the letter
dated 17.10.1992 addressed to the defendants 1 and 2 by
the 1st plaintiff which would reveal that the 1 st plaintiff has
sent 3 cheques for Rs.6,61,645.25 for full and final
settlement and the defendants were directed to execute a
power of attorney and also to obtain income tax clearance
for phase 3. In fact, the contents in A17 not disputed.
Ext.A18 is the letter dated 19.10.1992, addressed to the
defendants 1 and 2, which would reveal that the draft
power of attorney was sent to the defendants for
registration and also requested to arrange the Income Tax
Clearance for the 3rd phase. Ext. A21 is the letter dated
22.3.1993, addressed to the defendants 1 and 2 by the 1 st
plaintiff which also would reveal that the draft power of
attorney was sent to them for approval and execution. But
sofar they did not execute the power of attorney nor did
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R.F.A. Nos. 175 & 209 of 2003
they produce the income tax clearance certificate for the
3rd phase. They were requested to present the cheques
referred to in Ext. A17 for encashment only after executing
the general power of attorney. Ext.B42 series are the letters
dated 7.12.1994 of Deputy Director, Income Tax addressed
to 2nd defendant in which he was requested to sent the
particulars with respect to the property in which he has put
up the building. Ext.A25 is the Advocate's notice dated
4.3.1993 issued to the 1 st plaintiff that the cheques issued
under Ext.A17 returned dishonoured and the 1 st plaintiff
was directed to pay the full amount within 15 days. Thus,
the Exts.A17, 18, 21, 25 and B18 would suggestively gather
the inference that the defendants 1 and 2 have also failed
to obtain the income tax clearance certificates as well as to
execute the general power of attorney as stipulated in
Ext.A2 in time anticipating the payment of entire balance
consideration. PW1 deposed that he had paid
Rs.12,01,279/- towards 65% of the sale consideration for
the 1st phase and 100% was paid for the 2 nd phase, and it
was due to failure of the defendants to obtain the income
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R.F.A. Nos. 175 & 209 of 2003
tax clearance certificate for the 3 rd phase that he could not
execute the sale. When DW1 was cross-examined he
deposed that the draft sale deed for the 1 st phase to an
extent of 107.408 cents was given to him on 1.6.1992 only
on the basis of which he applied for income tax clearance
certificate and on receipt of the same it was informed to
the 1st plaintiff. But it was due to latches of the 1 st plaintiff
the sale deed could not be executed. In fact, no scrap of
paper has been produced from the side of defendants 1 and
2 to convince the fact that he was ready and willing to
execute the sale deed in respect of the 1 st and 2nd phase.
On the other hand, the discussions above would reveal that
defendants 1 and 2 were not willing to execute the sale
deed or to apply for income tax clearance certificate for the
3rd phase but were insisting for the payment of whole
balance sale consideration.
41. Thus, it is evident that DW1 admitted during
cross-examination that the draft sale deed for the 1 st phase
to an extent of 107.408 cents was given to him on
01.06.1992, only on the basis of which he applied for
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R.F.A. Nos. 175 & 209 of 2003
Income Tax Clearance Certificate and on receipt of the
same it was informed to the 1 st plaintiff. But, it was due to
laches of the 1st plaintiff, he could not execute the sale
deed. Thus, it appears that as far as 107.408 cents of
property is concerned, nothing remains to be completed to
execute the sale deed, since defendants 1 and 2 received
sale consideration for the said extent of land and in excess
of that and all the liabilities were cleared. But, defendants 1
and 2 would say that it was due to laches of the 1 st plaintiff,
they could not execute the sale deed and this aspect is not
digestible. It is true that, regarding the 2 nd phase in respect
of the sale of the remaining property, no Income Tax
Clearance certificate even applied by defendants 1 and 2,
solely on the ground that three cheques viz. Ext.B23, B26
and B29 for Rs.6,61,645.25 were dishonored. According to
the 1st plaintiff, those cheques were dishonored for the
reason 'stop payment', because of the reluctance on the
part of defendants 1 and 2 to co-operate with the
procedure for sale, though it is argued by the learned
counsel for defendants 1 and 2 that, the cheques were
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R.F.A. Nos. 175 & 209 of 2003
dishonored for the reason 'insufficient funds'. Anyhow, after
analyzing the entire evidence, the trial court found that the
1st plaintiff has been ready and willing to execute sale deed,
despite that due to the laches of defendants 1 and 2, sale
deed could not be executed. Thereby, the discretionary
relief by itself was granted by the trial court.
42. As far as the legal position governing the grant of
discretionary relief, the decisions cited by both sides will
hold the field. In order to obtain a decree for specific
performance, the plaintiff has to prove readiness and
willingness to perform his part of the contract and the
readiness and willingness has to be shown throughout and
has to be established by the plaintiff. Clause (c) of S.16 of
the Specific Relief Act, 1963, lays down the conditions
precedent to the enforcement of specific performance of a
contract. S.16(c) of the Act is couched in a negative form. It
mandates that specific performance of a contract cannot be
enforced in favour of a person who has failed to aver and
prove his readiness and willingness to perform his part of
the contract. In terms of S.16(c), what are the obligations
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R.F.A. Nos. 175 & 209 of 2003
which the plaintiff has to comply with in reference to his
plea and whether the plea of the plaintiff could not be
construed to conform to the requirement of the aforesaid
section, or does this section require specific words to be
pleaded that he has performed or has always been ready
and is willing to perform his part of the contract. In
construing a plea in any pleading, courts must keep in mind
that a plea is not an expression of art and science but an
expression through words to place fact and law of one's
case for a relief. Such an expression may be pointed,
precise, sometimes vague but still it could be gathered
what he wants to convey through only by reading the whole
pleading, depending on the person drafting a plea.
43. On evaluation of the evidence discussed in
detail, it could be gathered that, insofar as execution of
sale deed in respect of 107.408 cents of property is
concerned, the 1st plaintiff and defendants 1 and 2
mutually performed their part, even though, some
delay on the part of the defendants 1 and 2 could be
noticeable. Thus, with regard to 107.408 cents
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R.F.A. Nos. 175 & 209 of 2003
of property, defendants 1 and 2 failed to execute the sale
deed, even after receipt of sale consideration in excess of
the said extent of property as already observed. Similarly,
regarding the remaining extent of property, defendants 1
and 2 never obtained Income Tax Clearance Certificate to
execute the sale deed. Therefore, even though the 1 st
plaintiff has been ready and willing to execute the sale
deed, the same could not be executed because of non-
obtainment of Income Tax Clearance Certificate and
defendants 1 and 2 are reluctant in getting the same as per
the evidence already discussed. In such view of the matter,
the discretion exercised by the trial court in granting
specific relief itself, in a case where 65% of the sale
consideration was received by defendants 1 and 2 need not
require interference. Therefore, the said finding is
confirmed.
44. The next question is whether defendants 3 to 5,
are bonafide purchasers? As admitted in the written
statement filed by defendants 1 and 2 and as per Ext.B7,
the original title deed pertaining to the plaint schedule
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R.F.A. Nos. 175 & 209 of 2003
property has been in the custody of the 1 st plaintiff and the
same was obtained by them from the Union Bank of India,
after clearing the loan liability. When considering the
question as to whether defendant 3 to 5 are bonafide
purchasers of the plaint schedule property for valid
consideration, even though they purchased the property by
giving a slight increase in the consideration agreed upon
between the 1st plaintiff and defendants 1 and 2, they
obtained sale deeds in respect of the property, without
seeing the original title deed of the same. When a party
purchases property, normally a duty is cast upon the
purchaser to ensure that the property is one wherein no
liability lies and the same is free from encumbrance. In
cases of creation of equitable mortgage by deposit of title
deeds with the Bank or when the title deed is entrusted to
another party on executing a sale agreement to sell the
same in favour of another party etc. the absence of original
title deed in the custody of the vendor is a matter to be
noted by the vendee and when the original title deed when
failed to be showed and the vendee takes the risk to
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purchase the property even without seeing the original title
deed, the vendee could not be put under the status of
bonafide purchaser, in any manner.
45. That apart, as observed by the trial court, no
scrap of papers had been produced to show that
defendants 3 to 5 have paid amounts in Ext.B43 to B53, in
a uniform manner. On perusal of Ext.B43 to B53, the sale
consideration shown in respect of different extent of land
are one and the same, except in one of the document.
Therefore, the testimony of DWs 2 and 3 and the
contention raised by defendants 3 to 5 that they are
bonafide purchasers of the plaint schedule property could
not be found in their favour. Therefore, the testimony of
DWs2 and 3 to the effect that they have bonafidely
purchased the property, is not convincing.
46. In the instant case, as already referred, the
additional 9th respondent in I.A. No.1884/2006 in R.F.A.
No.209/2003, being the subsequent purchaser from
defendants 3 to 5, made constructions in the plot which do
form part of the plaint schedule property, with undertaking
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R.F.A. Nos. 175 & 209 of 2003
as extracted in paragraph No.20. Therefore, the additional
9th respondent in I.A. No. 1884/2006 has no right to retract
from his undertaking as averred in the affidavit.
Commission reports dated 24.06.2005 and 20.06.2006
obtained by this Court during the pendency of these
appeals, got marked as Exts.C2 and C3, it is seen that
during the pendency of this appeal, an interim injunction
restraining further construction was ordered and the same
is in force. In fact, as per Exts.C2 and C3, only a few
persons constructed buildings in the plaint schedule
property initially, that too during the pendency of the suit
and majority of the constructions were made thereafter in
violation of the interim order of injunction. Therefore, the
other defendants as well as the additional 9 th respondent in
I.A. No.1884/2006 in R.F.A. No.209/2003 also would not get
protection as bonafide purchasers.
47. Summarizing the discussion, it is held that the
trial court rightly exercised its discretion by granting decree
of specific performance. Therefore, the verdict impugned
would not require any interference.
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48. In the result, these regular first appeals are liable
to fail and the same stand dismissed. Having considered
the nature of these cases, the 1 st plaintiff is entitled to the
cost of the proceedings to be realized from the contesting
defendants.
49. Since, the balance consideration as per the trial
court decree was deposited on 10.01.2003 before the trial
court, defendants 1 and 2 are directed to execute the sale
deed in respect of plaint schedule property, within a period
of one month from today and on failure to do so, the 1 st
plaintiff is at liberty to execute the sale deed through
process of court.
All interlocutory orders stand vacated and all
interlocutory applications pending in these regular first
appeals stand dismissed.
Sd/-
A. BADHARUDEEN
SK
JUDGE
