Madras High Court
Krishnan vs Ponnusamy Naidu on 7 July, 2022
1
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 07.07.2022
Coram
THE HON'BLE Mr.JUSTICE C.V.KARTHIKEYAN
S.A.No.630 of 2012
and
M.P.No.1 of 2012
Munusamy Chetty (deceased)
1.Krishnan
2.Ravi
3.Ramesh
4.Sivagami
5.Meena
6.Shanthi
7.Lakshmi
8.Kaliyammal ... Appellants
Vs
Ponnusamy Naidu ... Respondent
PRAYER:The Second Appeal filed under Section 100 of CPC, against the
judgment and decree made in A.S.No.23 of 2008 dated 30.09.2011 on the
file of the Principal District Court, Villupuram, reversing the judgment and
decree made in O.S.No.279 of 1994 dated 10.04.2006 on the file of the
Additional Subordinate Judge, Tindivanam.
For Appellants : Mr.R.Thirugnanam
For Respondent : Mr.P.Sankara Narayanan
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2
JUDGMENT
The plaintiffs in O.S.No.279 of 1994 on the file of the Additional
Sub Court, Tindivanam, are the appellants herein.
2.O.S.No.279 of 1994 had been originally filed by Munusamy
Chetty against the defendant Ponnusamy Naidu seeking specific
performance of an agreement dated 09.10.1992, by which, the defendant
had undertaken and agreed to convey the suit schedule property on receipt
of the balance sale consideration. There were three items of the suit
schedule properties and they were Punja lands. The first item was in survey
No.33/2 measuring 1.18 acres, the second item was in survey No.25/2
measuring 1.48 acres and the third item was in survey No.47/3 measuring
2.61 acres all at Sevanur village in Tindivanam.
3.The plaintiffs claimed in the plaint that the defendant had debts and
therefore, was in need of money and had agreed to convey the
aforementioned properties by way of the said undertaking given by him on
09.10.1992. It had been stated that the total sale consideration for the
aforementioned properties was determined as Rs.1,34,000/- and on the date
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of the agreement dated 09.10.1992, an advance amount of Rs.55,000/- had
been paid. A further advance amount of Rs.10,000/- had been paid on
11.02.1993. The sale should have been completed by 28.02.1993. The suit
was filed on 14.11.1994. It had been stated that the plaintiff had also filed a
lodgment schedule undertaking to pay the balance sale consideration of
Rs.69,000/-. Stating that the plaintiff was ready and willing to perform his
part of the agreement, the suit had been filed seeking specific performance
directing the defendant to perform his part of the agreement, to register the
sale deed with respect to the aforementioned properties.
4.A written statement was filed by the defendant. In the preliminary
portion of the written statement from paragraphs 1 to 9, the defendant had
denied the execution of the agreement. However, in paragraph No.10, he
admitted that he had actually executed the said agreement dated 09.10.1992
but that he had received an advance of Rs.50,000/- and not Rs.55,000/-as
alleged. He also admitted to receiving a further advance amount of
Rs.10,000/- on 11.02.1993. The defendant also stated that owing to various
other factors, there were some debts over the properties. The agreement had
therefore been entered into and it was also stated that the suit for specific
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performance was beyond the period as stipulated in the agreement and
therefore, not maintainable and that the relief sought should not be granted.
5.It must also be mentioned that during the course of the pendency of
the original suit, the plaintiff died and his legal representatives were brought
on record as 2 to 9th plaintiffs.
6.The trial Court, on the basis of the aforementioned pleadings,
framed the following issues:
“1.Whether the undertaking dated
09.10.1992 is true, valid and enforceable?
2. whether the plaintiff was ready and
willing to perform his part of the undertaking?
3.Whether the contention of the plaintiff
that a sum of Rs.17,000/- should be adjusted
towards the balance sale consideration
consequent to the cutting and selling of the trees
in the properties by the defendant is acceptable?
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4.Whether the suit is maintainable without
issuing a pre suit notice?
5.Whether the plaintiff is entitled to any
further reliefs?
6.To what other reiefs, the plaintiffs are
entitled to?
7.The parties were invited to adduce evidence and accordingly, on the
side of the plaintiffs, the 9th plaintiff Kaliammal was examined as PW1 and
one other independent witness was examined as PW2. On the side of the
defendant, the defendant was examined as DW1 and two other witnesses
were examined as DW2 & DW3.
8.The plaintiffs marked Exs.A1 to A9. Ex.A1 was the undertaking or
the agreement dated 09.10.1992 and Ex.A2 was an endorsement for receipt
of a further sum of Rs.10,000/- by the defendant dated 11.02.1993. The
other documents related to the debts under which the property was subject
to and not directly connected with the issues to the suit.
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9.The trial Court, thereafter, took up for consideration issue Nos.1
and 6 namely the enforceability of the undertaking dated 09.10.1992 and to
what relief, the plaintiffs were entitled to.
10.It was found that the defendant had agreed to the execution of
Ex.A1 and receipt of advance and also the receipt of further advance of
Rs.10,000/- on 11.02.1993. It was also observed that towards the loan debt
incurred by the defendant, one Boomiammal had actually instituted
O.S.No.245 of 1992 and O.S.No.83 of 1996 and to that extent, Exs.A5 to
A8 had been marked. It was stated that owing to that particular aspect, since
there was a charge over the property, the statement of the defendant, as to
why he postponed the registration of the agreement, was accepted by the
trial Court.
11.It was also stated that since the agreement had been established to
be true and admitted and further, the advance amounts had also been
received and further, the lodgment schedule had been filed by the plaintiff at
the time of the institution of the suit undertaking to pay the balance sale
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consideration of Rs.69,000/-, the trial Court held that the plaintiffs had
made out a case for specific performance and accordingly, decreed the suit.
12.Aggrieved by such judgment and finding thereon, the defendant
filed A.S.No.23 of 2008, which came up for consideration before the
Principal District Court at Villupuram. The Principal District Judge,
Villupuram, framed the following points for consideration under Order 41
Rule 31 of the Code of Civil Procedure.
“1.Whether the 1st plaintiff was ready and
willing to perform his part of the contract?
2.Whether the suit suffers from non
issuance of pre suit notice?
3.Whether the conduct of the parties
qualifies the plaintiffs to get a decree and
judgment against the defendant specifically
enforcing the contract dated 09.10.1992?
4.Whether the appeal has to be allowed or
not?”
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13.All the three points which were framed were taken up together for
consideration. The first appellate Court observed that Ex.A1 having been
admitted, the only aspect to be examined is whether it had been dealt with
and the condition thereon performed by the parties. It was found that Ex.A1
was dated 09.10.1992 and time was fixed by 28.02.1993 for payment of
balance sale consideration of Rs.79,000/-. The other aspects of payment of
advance and further advance payment of Rs.10,000/-, were taken to have
been established and proved since they had been accepted. The first
appellate Court then however observed that the further consideration of
Rs.10,000/- was probably for the purchase of oil engine for agricultural
purpose, though there was an endorsement in Ex.A1 with respect to the
same.
14.Thereafter, though the first appellate Court correctly held that in
an agreement for conveyance of immovable property, time is not necessarily
the essence of the agreement, unless the parties had specifically agreed to
the same, it was also found that the plaintiffs had not issued any notice prior
to the institution of the suit or called upon the defendant to come forward to
register the sale deed in accordance with his undertaking in Ex.A1.
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15.Finding fault with the plaintiffs for non issuance of a pre suit
notice, the first appellate Court interfered with the judgment of the trial
Court, reversed the finding thereon and allowed the appeal, thereby
dismissing the suit. This dismissal of the suit and allowing of the first
appeal had led the plaintiffs to file the present second appeal.
16.The second appeal had been admitted on the following two
substantial questions of law:
“1.Whether the Lower Appellate Court was
right in holding that the deceased 1st plaintiff was
not ready and willing to perform his part of the
contract when he has paid the major portion of the
sale consideration before filing the suit and
deposited the balance sale consideration after
filing the suit?
2.Whether the deceased 1st plaintiff was not
entitled to the relief of specific performance when
he has averred and proved about his readiness
and willingness to perform his part of the
contract?”
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17.Both the substantial questions of law revolve around readiness and
willingness on the part of the appellant herein/plaintiff. The first substantial
questions of law surrounds whether, when the plaintiff had paid a major
portion of the sale consideration before the filing of the suit and deposited
the balance sale consideration after the filing of the suit, still, could the
plaintiff be non-suited on the ground of not being ready and willing to
perform his part of the agreement. The second substantial question of law
reverts to the pleadings as whether averments in the plaint that the plaintiff
was ready and willing would not be sufficient to hold that the plaintiff was
actually ready and willing to perform his part of the contract or agreement.
18.Let me take up for consideration the second substantial questions
of law first, since that surrounds the averment made in the pleadings.
19.In the plaint, the plaintiff had spoken about the debts surrounding
the property. It was thereafter stated that a Panchayat was held and there
was extension of the time limit specified in the agreement. Thereafter, it was
specifically stated that the plaintiff was ready and willing to pay the balance
sale consideration of Rs.69,000/- and towards that, was also filing a
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lodgment schedule along with the plaint seeking permission to deposit the
said amount of Rs.69,000/-. This statement that the lodgment schedule was
filed along with the plaint was again reiterated in the plaint.
20.In the plaint, the plaintiff must aver that the agreement entered into
was lawful, that the consideration was lawful and adequate, that the object
was lawful and that he was always ready and willing to perform his part of
the agreement viz., to pay the balance sale consideration.
21.It has been pointed out by the learned counsel for the respondent
before this Court that Ex.A1 is actually not an agreement but only an
undertaking given by the respondent herein/defendant agreeing to sell the
property. He was coming forward to sell the property and had received an
advance of a particular sum of money. He had also stipulated that he expects
a further balance to be given to him within a specific date. He had also
given a particular undertaking that, on violating any clause in the
undertaking, he should be put up with a forfeiture process with respect to
the advance amount. He had not stated the consequences that would happen,
if the plaintiff or the appellant herein did not keep up with the scheduled
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time limit specified in Ex.A1. If that had been done, the intention of the
respondent/defendant that he was particular that time was actually the
essence of the agreement or the undertaking given by him would be evident.
But unfortunately that is not reflected in Ex.A1.
22.It is stated that Ex.A1 was drafted in English by a bank official
from Andra Pradesh but even then, the respondent/defendant had admitted
to the execution and admitted to receiving the advance amount under the
agreement. He should have then stipulated a condition that time was the
essence of the agreement and to enforce and ensure that time was the
essence of the agreement, should have also informed the plaintiff that if he
did not pay the balance sale consideration within the time stipulated then the
advance would be forfeited or the agreement would stand frustrated. If, time
was to be essence of the agreement, then on the expiry of the time limit
specified then it also creates an obligation on the respondent/defendant to
issue a notice cancelling or withdrawing or rescinding from the undertaking
given. No such steps have been taken.
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23.It is an admitted fact that the property was under charge and there
were also two suits, which had been filed for recovery of amounts from the
respondent/defendant. Therefore, there was a necessity to generate funds on
the property to pay the debts.
24.It is therefore evident that the respondent/defendant had executed
Ex.A1, had received advance amount under Ex.A1, and though had
specified an out of time limit for receipt of the balance, had not specified
any default clause or forfeiture clause and more importantly had not
rescinded from the undertaking after the time limit had expired. Once such
steps had not been done by the respondent/defendant then the averments in
the plaint that the plaintiff is ready and willing to deposit the balance sale
consideration into the Court has to be taken as a bonafide stated. I would
answer the second substantial question of law by holding that the plaintiff
was actually ready and willing to perform his part of the agreement namely
to deposit the balance sale consideration into Court or to pay the balance
sale consideration to the respondent/defendant.
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25.Now, let me take up the first substantial question of law which
again is revolves around the second substantial questions of law namely
whether such deposit into would indicate that the plaintiff/appellant herein
was actually ready and willing.
26.The fact that the plaintiff had actually undertaken before the Court
to deposit the sum of Rs.69,000/- indicates that he was in possession of such
money. He had the balance sale consideration in his possession and he was
willing to deposit the amount and that is expressed by filing the lodgment
schedule. Therefore, the readiness, the availability, the possession of the
balance sale consideration are all evident by the fact that the plaintiff had
filed the lodgment schedule along with the plaint to indicate to the Court
and also to inform the respondent/defendant that the balance sale
consideration is available and he was also willing to part with it.
27.The learned counsel for the appellants had relied on the judgment
of a learned single Judge of this Court reported in 2022 (2) TLNJ 283
(Civil) (Lakshmi Ammal and two others Vs. Gejaraj (died) and others). It
had been held as follows in paragraphs 18, 19 & 20
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“18. The learned counsel for the appellants submitted
that the plaintiff did not prove that he was ready and willing to
perform his part of the contract and not even a pre-suit notice
was issued before the suit was filed. In the present case, it was
the 1st defendant who was continuously in touch with the
plaintiff and his Power of Attorney seems to have been
cancelled only on 14.03.2007. Till then, there was no occasion
for the plaintiff to interact with the defendants 2 to 5. After
coming to know of the revocation of the Power of Attorney, the
plaintiff had attempted to get in touch with the defendants 2 to
4 during the last week of March, 2007 requesting them to
execute the sale deed in his favour after receiving the balance
sale consideration. A specific averment in this regard is found
at Para No. 11 of the plaint and the plaintiff, who examined
himself as P.W.1, has also spoken about the same. Since the
period of three years was coming to an end on 11.05.2007, the
plaintiff thought it fit to immediately institute the suit on
16.04.2007. Under such circumstances, non-issuance of a pre-
suit notice cannot be put against the plaintiff. Law does not
expect that, in every case, there should be a pre-suit notice
before a suit is filed. It will depend upon the facts and
circumstances of each case and there cannot be a strait-jacket
formula to mandate the issuance of pre-suit notice in every
case. This is one such case, where, in view of the terms of the
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agreement, the plaintiff was forced to institute the suit without
issuing the pre-suit notice, since the three year period was
coming to an end.
19. The facts of the present case is squarely covered by
the recent judgment of the Hon'ble Supreme Court in
P.Ramasubbamma v. V. Vijayalakshmi & Others [Civil Appeal
No. 2095 of 2022, dated 11.04.2022]. The relevant paragraph
in the judgment is extracted hereunder:
"5.2. 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 required to go into the
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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."
20 .Once the execution of the agreement of sale and the
receipt of the substantial amount towards the sale
consideration is established, there is nothing more to be
proved by the agreement holder to establish his readiness and
willingness to perform his part of the contract. The finding of
the lower Appellate Court in this regard does not suffer from
any perversity and it does not require the interference of this
Court. This Court holds that the plaintiff had established the
execution of the sale agreement and also the payment of
substantial amount towards sale consideration and also his
readiness and willingness to perform his part of the contract.
Therefore, the natural consequence would be that the plaintiff
will be entitled for the relief of specific performance. The
substantial question of law framed by this Court is answered
accordingly.”
28.The learned counsel also relied on the judgment of a learned
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Single Judge of this Court reported in 2022 (2) CTC 69 (T.Ravindran Vs.
S.Anandhavalli). It had been held as follows in paragraphs 18, 19, 20 & 21
“18. In a recent decision in Sughar Singh v. Hari Singh
(dead) through L.R.s. And others, 2021 SCC OnLine SC 975, a
Division Bench of the Apex Court, following the view taken in
its earlier three Judges Bench decision in Syed Dastagir v.
T.R. Gopalakrishna Setty 1999 (6) SCC 37 to the effect that the
language in Section 16(c) does not require any specific
phraseology but only that the plaintiff must aver that he has
performed or has always been and continues to be willing to
perform his part of the contract and to insist on mechanical
reproduction of the exact words of the statute would be to
insist on the form rather than the essence and thereby the
absence of form cannot dissolve an essence if already pleaded
and the decision in C.S. Venkatesh v. A.S.C. Murthy 2020 (2)
MWN (Civil) 250 (SC): 2020 (3) SCC 280, to the effect that it
is not necessary for the plaintiff to produce ready money to
establish his readiness and willingness to pay the
consideration, but, it is mandatory on his part to prove that he
had the means to generate consideration amount within the
time frame contemplated in the contract, has held as under:-
"10. Now, so far as the finding recorded by the
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High Court and the observations made by the
High court on Section 20 of the Act and the
observation that even if the agreement is found to
be duly executed and the plaintiff is found to be
ready and willing to perform his part of the
Agreement, grant of decree of specific
performance is not automatic and it is a
discretionary relief is concerned, the same cannot
be accepted and/or approved. In such a case,
many a times it would be giving a premium to the
dishonest conduct on the part of the
defendant/executant of the agreement to sell. Even
the discretion under Section 20 of the Act is
required to be exercised judiciously, soundly and
reasonably. The plaintiff cannot be punished by
refusing the relief of specific performance despite
the fact that the execution of the agreement to sell
in his favour has been established and proved and
that he is found to be always ready and willing to
perform his part of the contract. Not to grant the
decree of specific performance despite the
execution of the agreement to sell is proved; part
sale consideration is proved and the plaintiff is
always ready and willing to perform his part of
the contract would encourage the dishonesty. In
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such a situation, the balance should tilt in favour
of the plaintiff rather than in favour of the
defendant-executant of the agreement to sell,
while exercising the discretion judiciously."
19. In S. Kaladevi vs. V.R. Somasundaram and others
2010 (3) MWN (Civil) 556 (SC): (2010) 5 SCC 401, it has been
held that the admissibility of unregistered sale deed as
evidence is not hit by Section 3(b) of the Specific Relief Act,
1963.
20. In Motilal Jain v. Ramdasi Devi (Smt.) and others
2000 (6) SCC 420, it has been held that where major portion
of the consideration (two-thirds in that case) was paid at the
time of execution of the contract, held, his willingness to pay
the remaining amount is apparent.
21. On analysis of the factual circumstances of the
present case in the light of the law laid down in the above
decisions, this court finds that the plaintiff having paid the
entire sale consideration of Rs. 2,40,000/- there is no question
of proving readiness and willingness on the part of the
plaintiff. Further, the averment at para 6 of the plaint and
reading of the plaint in whole disclose the essence and it
clearly indicates that the plaintiff was ready and willing to
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fulfil her part of the obligation. The pleadings in the plaint
cannot be deemed to be not in conformity with Order 6 Rule 3
CPC and clause 3 of Form 47 in Appendix "A" as the averment
required under Order 6 Rule 3 of CPC and Clause 3 of Form
47 in Appendix "A" is not a mathematical formula capable of
being expressed only in certain specific words and terms.”
29.Placing reliance on the aforementioned position of law as stated, it
is the contention of the learned counsel for the appellant that having
deposited the amount at the time of institution of the suit, particularly, when
execution of Ex.A1 had been admitted, the appellant herein had made out a
case for declaring that he was ready and willing to perform his part of the
agreement.
30.The learned counsel for the respondent brought to the notice of
this Court, a judgment of the Hon'ble Supreme Court in Civil appeal
No.150 of 2022 (Shenbagam & Ors. Vs. KK Rathinavel), wherein, the
learned counsel had relied on paragraph 36.
“36.True enough, generally speaking, time is not of the
essence in an agreement for the sale of immovable property. In
deciding whether to grant the remedy of specific performance,
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specifically in suits relating to sale of immovable property, the
courts must be cognizant of the conduct of the parties, the
escalation of the price of the suit property, and whether one
party will unfairly benefit from the decree. The remedy
provided must not cause injustice to a party, specifically when
they are not at fault. In the present case, three decades have
passed since the agreement to sell was entered into between
the parties. The price of the suit property would undoubtedly
have escalated. Given the blemished conduct of the
respondent-plaintiff in indicating his willingness to perform
the contract, we decline in any event to grant the remedy of
specific performance of the contract. However, we order a
refund of the consideration together with interest at 6% per
annum.”
31.A careful perusal of the facts of that particular case go to show
that the Hon'ble Supreme Court found fault with the trial Court for not
having framed an issue regarding readiness and willingness. As a matter of
fact, the Hon'ble Supreme Court had observed with respect to the absence
of any issue being framed and had held as follows:
“25. All the three courts, including the High
Court, grossly erred in the manner in which they have
adjudicated upon this dispute in a suit for specific
performance. In the first instance, the trial court failed to
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frame an issue on whether the respondent plaintiff was ready
and willing to perform his obligations under the contract and
instead assessed whether he is entitled to the relief of specific
performance. In doing so, the trial court viewed the legal issue
from an incorrect lens. The foundation of a suit for specific
performance lies in ascertaining whether the plaintiff has
come to the court with clean hands and has, through his
conduct, demonstrated that he has always been willing to
perform the contract. There is a conspicuous absence in
judgment of the trial court of any reference to evidence led by
the respondent to indicate his willingness to perform the
contract. The trial court merely adverted to “document
produced on behalf of the plaintiff” and concluded that he had
sufficient means to purchase the suit property. Apart from this
observation, the judgment fails to analyse the terms of the
agreement, the obligations of the parties and the conduct of
the respondent or the appellant.”
32.Therefore, the judgment relied on the learned counsel for the
respondent is distinguishable on one important fact namely the filing of the
lodgment schedule by the appellant herein indicating readiness and
willingness to deposit the balance sale consideration of Rs.65,000/- in the
Court.
33.One further aspect raised was whether Ex.A1 could be termed as
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an agreement as such. It is a clear undertaking to convey the property. It has
been admitted. It has been accepted. The amount mentioned has been and
had also been retained by the respondent /defendant which would indicate
that he had agreed to abide by the terms therein. If the respondent
/defendant wanted to retract on such an undertaking, he should have in the
first instance returned back the advance amount and informed the
appellant/plaintiff that the undertaking stood cancelled. No such steps were
taken. On the other hand, the written statement which was also verified by
the defendant solemnly stating that every statement would bind the
respondent/defendant on Ex.A1 since he had admitted to the execution of
Ex.A1.
34.In (1993) 1 Supreme Court Cases 519 (Chand Rani (Smt)
(Dead) By Lrs. Vs. Kamal Rani (Smt) (Dead) By Lrs, the Constitution
Bench of the Hon'ble Supreme Court examined whether time could be
essence of an agreement of sale particularly with respect to the immovable
property. The Constitution Bench held very clearly that time was not the
essence of the agreement and stated that it could be so only when the parties
very specifically stated that time was the essence and that beyond the time
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period neither would act on the agreement. The relevant portion of the
judgment in para 25 reads as follows:
“25.From an analysis of the above case-law it is
clear that in the case of sale of immovable property there is no
presumption as to time being the essence of the contract. Even
if it is not of the essence of the contract the Court may infer
that it is to be performed in a reasonable time if the conditions
are evident:
1.From the express terms of the contract;
2.from the nature of the property; and
3.from the surrounding circumstances, for
example; the object of making the contract.”
35.In the instant case, the respondent /defendant had not rescinded
from the agreement. This would indicate that he had himself agreed that
time was not the essence of the agreement. The Non-issuance of pre-suit
notice pales into insignificance. The appellant/plaintiff had, at the time of
filing of the suit filed a lodgment schedule indicating readiness and
willingness to pay the balance sale consideration.
36.I would answer the first substantial questions of law that the
appellate Court was not correct in holding that the appellant was not ready
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and willing to perform his part of the agreement.
37.In the result,
(i).the judgment and decree of the First Appellate Court in A.S.No.23
of 2008 dated 30.09.2011 on the file of the Principal District Court,
Villupuram, is set aside.
(ii).The judgment and decree of the Trial Court in O.S.No.279 of
1994 dated 10.04.2006 on the file of the Additional Subordinate Court,
Tindivanam, is restored and confirmed.
(iii).The time period specified therein for further performance is
retained. The second appeal in S.A.No.630 of 2012 is allowed with costs.
Consequently, connected miscellaneous petition is closed.
Index:Yes/No 07.07.2022
Internet:Yes/No
sms
To
1.The Principal District Court, Villupuram.
2.The Additional Subordinate Judge, Tindivanam.
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3.The Section Officer, VR Section,
Madras High Court.
C.V.KARTHIKEYAN,J.
sms
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S.A.No.630 of 2012
and
M.P.No.1 of 2012
07.07.2022
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