Madras High Court
Ramasamy (Died) vs Barathan on 18 April, 2023
A.S.No.326 of 2011
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 18.04.2023
CORAM
THE HONOURABLE MRS.JUSTICE K.GOVINDARAJAN THILAKAVADI
A.S.No.326 of 2011
and
Cross Obj.No.188 of 2011
and M.P.No.1 of 2011
1.Ramasamy (died)
2.Radjacoumar (died)
3.Radjasankar
4.Pouchepalata
5.Babu
[proposed appellants 2 to 5 are the legal heirs of
deceased 1st appellant]
6.Rajamalathi
7.Prethiviraj
8.Priyadarshni
[proposed appellants 6 to 8 are the legal heirs of
deceased 2nd proposed appellant]
Appellants 3 to 8 brought on record as Legal heirs
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A.S.No.326 of 2011
of the deceased 1st appellant Ramasamy and deceased
elder brother Mr.Radjacoumar vide order of Court
dated 30.01.2020 made in C.M.P.Nos.27090, 27098 &
27060 of 2019 in A.S.No.326 of 2011 (SMSJ)
.. Appellants/defendants
Vs
Barathan ... Respondent/plaintiff
Prayer: First Appeal has been filed under Order 41 Rule (1) of the r/w
Section 96 of the Civil Procedure Code against the judgment and decree
dated 21.12.2009 made in O.S. No.22 of 2007 on the file of the II Additional
District Judge, Puducherry.
For appellant : Mr.J.Cyril Mathias Vincent
For Respondent : M/s.Elizabeth Ravi
for P.Raja
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JUDGMENT
The Appeal Suit has been filed to set aside the judgment and decree
dated 21.12.2009 made in O.S. No.22 of 2007 on the file of the II Additional
District Judge, Puducherry.
2.This is a suit filed by the plaintiff for Specific Performance in respect
of the sale agreement dated 02.02.2006, directing the defendant to execute a
sale deed in his favour after receiving the balance sale consideration of
Rs.8,00,000/- from and in default this court to execute the sale deed and
convey the suit property belonging to the defendant in his favour or in the
alternative, direct the defendant to refund a sum of Rs.7,00,000/- with interest
at 24% p.a. from 02.02.2006 till payment. The defendant in O.S.No.22 of
2007.
The averments in the plaint, in brief, are as follows:
There is a concluded contract entered into between the plaintiff and the
defendant for the sale of a landed property in favour of the plaintiff.
Accordingly a sale agreement dated 02.02.2006 was executed bilaterally by
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the defendant on one hand and the plaintiff on the other hand for the sale of
two adjacent vacant land house sites measuring totally to an extent of 3603
sq.ft. situated at Kumaran Nagar, Saram Revenue Village, comprised in
Cadastre Nos.1056 ½ part 1046 2/2 part, Re-survey No.17/1 C for due
consideration of Rs.15,00,000/- and the defendant had received a sum of
Rs.7,00,000/- from the plaintiff towards the advance amount of sale
consideration at the time of executing the said agreement.
3.As per the terms of the sale agreement, the defendant should produce
the title deeds of the suit property and other relevant documents on or before
25.06.2006 and complete the sale. The plaintiff has expressed his readiness
and willingness to purchase the suit property from the defendant on several
occasions through his relatives and also by direct phone calls. However, for
the reasons best known to him, the defendant was postponding the execution
of sale deed for one reason or other. When the plaintiff's brother in law by
name Jayaraman approached the defendant on 25.03.2006 to pay the entire
sale consideration of Rs.8,00,000/-, the defendant has informed that he has to
get the patta copy and field map and therefore he required some time.
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4.While so, when the said Jayaraman has subsequently visited the suit
property, found one Sithanandam in occupation of a portion of the suit
property by putting up a new thatched hut. The said Jayaraman immediately
brought this to the knowledge of the defendant. The defendant assured him
that shortly, he would ask the said Sithanandam to remove the hut put up by
him. But till date, the defendant has not done so. But to his surprise, the
defendant sent a lawyer's notice on 21.09.2006 calling upon the plaintiff to
get the sale deed executed in his favour by paying the balance sale
consideration. The plaintiff received the said notice and sent a reply on
06.12.2006 through his counsel expressing his readiness and willingness to
purchase the suit property by paying the entire balance sale consideration and
further requested the defendant to hand over vacant possession of the suit
property, after removing the thatched hut put by the third party in the suit
property. Moreover, as per the terms of the sale agreement, the defendant is
bound to hand over vacant possession of the suit property to the plaintiff.
Since the defendant failed to do so, the plaintiff was constrained to file this
suit for specific performance.
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5.The averments in the written statement filed by the defendant in
brief, are as follows:
6.It is true that the plaintiff and the defendant entered into an
agreement dated 02.02.2006 for sale of suit property and the total sale
consideration for the suit property was fixed at Rs.15,00,000/- and a sum of
Rs.7,00,000/- wad paid as advance. But the plaintiff failed to comply with the
terms and conditions and schedule of payment as stipulated in the agreement
to complete the sale on 02.02.2006. After the execution of sale agreement,
the plaintiff left India for Australia and this defendant expressed his
intention, readiness and willingness on several occasions to conclude the sale
in terms of the agreement dated 02.02.2006 to the plaintiff and to his brother
in law. However, the plaintiff was not interested in concluding the sale. This
defendant denies that one third person is in occupation of a portion of the
suit property by putting up a thatched hut. The said Sithanandam is a stranger
to the suit property and was set up by the plaintiff for having a re-negotiation
of the sale consideration, to reduce the sale consideration. The defendant is
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ready and willing to conclude the sale. But the plaintiff was not willing to
conclude the sale. The defendant is also ready to deposit the advance amount
into the court. Hence, he prays for dismissal of the suit.
7.On consideration of the pleadings, the trial Court framed the
following issues:
''1. Whether the Plaintiff is entitled to get the sale deed
executed by the defendant in respect of suit schedule
property as per the sale agreement dated 02.02.2006?
2. To what other relief the parties are entitled?''
8.This first appeal was preferred by the unsuccessful defendant against
the grant of Decree for Specific performance in favour of the plaintiff. The
suit was filed in O.S.No.22 of 2007 before IInd Additional District Judge,
Puducherry.
9.The plaintiff examined himself as P.W.1 and Ex.A1 to A.5 were
marked on the side of the plaintiff. The defendant was examined as D.W.1
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and no document was marked on the side of the defendant. On consideration
of the oral and documentary evidence, the learned trial Judge came to the
conclusion that the plaintiff has been ready and willing to perform his part of
the Contract and granted the relief of specifice performance to the plaintiff.
10.Aggrieved by the said judgment and decree, the defendant has
preferred the above appeal.
11.Heard, Mr.J.Cyril Mathias Vincent, learned counsel appearing for
the appellant/defendant and M/s.Elizabeth Ravi, learned counsel appearing
for the respondent/plaintiff.
For the sake of convenience the parties are referred as per their ranking
in the trial Court.
12.The learned counsel appearing for the appellant/defendant would
submit that, in Ex.A.2 sale agreement, it is mentioned that on or before
25.05.2006 within which time, the sale shall be completed. But the Plaintiff
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has neither made any attempt nor exhibited any tangible evidence to show
that he was ready and willing to pay the balance sale consideration and to
register the sale deed. The learned counsel would contend that when a clause
in the agreement stipulate a fixed time schedule for payment of consideration,
time was essence of Contract. His further contention is that, the plaintiff
failed to prove with satisfactory evidence that he was always ready and
willing to perform his part of contract at all material time as mandatorily
required under Section 16 (c) of the Specific Relief Act 1963. To support his
contention he has relied upon the following decision cases:
1. AIR 1993 SC 1742
2. AIR 2011 SC 3234
3. AIR 1997 SC 1751
4. AIR 2022 SC 3361
5. 2015 (14) SCC 341
13.Therefore, he would submit that, without considering the above
factual matrix the trial Court erroneously granted a Decree for Specific
performance in favour of the plaintiff which called for interference.
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14.On the other hand, the learned counsel appearing for the
respondent/plaintiff would submit that the plaintiff was always ready and
willing to perform his part of the Contract. In fact, the defendant was
evading to receive the balance sale consideration and to execute the sale deed
in favour of the plaintiff. The defendant supressed the material fact that a
third party has put up a hut in the suit property and when the same was
brought to the knowledge of the defendant, the defendant promised to remove
the same and hand over vacant possession and complete the sale transaction.
Since the defendant failed to comply the same, the plaintiff was forced to file
the above suit. It is submitted that, the remedy for specific performance is an
equitable remedy and it depends upon the conduct of the parties. The
necessary ingredient has to be proved and established by the plaintiff so that
discretion would be exercised judicially in favour of the plaintiff. At the same
time, if the defendant does not come with clean hands and supresses material
facts and evidence and misleads the Court, then such discretion should not be
exercised by refusing to grant a specific performance. It is further submitted
that efflux of time since execution of agreement of sale and escalation of
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price of property in meanwhile, itself, is not a valid ground for refusal to
exercise discretion to grant a decree for specific performance of agreement of
sale of immovable property. Instead, the Court may direct the plaintiff to pay
an additional amount to defendant. It is further submitted that the plaintiff
was always ready and willing to peform his part of Contract and therefore the
plaintiff is entitled to a decree for specific performance. Since, the plaintiff
has paid 50% of sale consideration before due date of execution of sale deed,
the financial capacity of plaintiff to prove his readiness and willingness is
irrelevant. And that, depositing balance sale consideration before filing suit
not essential for proving readiness, in absence of Court order, as per
explanation (1) to Section 16(c) of Specific Relief Act. The further
submission of the learned counsel for the plaintiff is that, the time stipulated
in the agreement was only to enable the seller to fulfil his obligation and
therefore time was not essence of Contract. The learned trial Judge has
rightly decreed the suit filed by the plaintiff and therefore, calls for no
interference. To support her contention, the learned counsel plaintiff has
relied upon the following decision cases reported in:
1.2015 (1) SCC 705
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2.2008 (11) SCC 45
3. 2017 (1) CTC 46
4. 2017(2) CTC 656
5.2017(5) CTC 785
6.2017 (4) CTC 734
7. 2017 (5) CTC 154
8. 2019 (6) CTC 859
9.2020 (2) L.W. 418
10. 2021 (1) L.W.388
15.Heard on both sides, and perused the records.
The following points were emerged for determination in this appeal.
''1.Whether time is the essence of the Contract?
2.Whether the plaintiff had established that he has
been ready and willing to perform his part of the
Contract?
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3.Whether the the plaintiff is entitled for cost as
claimed in the cross objection ?
4. To what relief plaintiff is entitled to? ''
Point No.1
16.The law is well settled that in transaction of sale of immovable
property, time is not essence of Contract. From an analysis of the case laws
referred, by the plaintiff, it is clear that in the case of sale of immovable
property, there is no presumption as time being the essence of Contract.
However, even if time is not of the essence of the Contract, the Court may
infer that it is to be performed in a reasonable time. In this context, the
Hon'ble Supreme Court in Smt.Chand Rani (Dead) By Lrs. Vs. Smt. Kamal
Rani (Dead) By Lrs., reported in [AIR 1993 SC 1742] held as under:
It is well accepted principle that in the case of sale of
immovable property, time is never regarded as the essence
of the Contract. In fact, there is a presumption against time
being the essence of the Contract. Under the law of equity
which governs the rights of the parties in the case of
specifice performance of contract to sell real estate, law
looks not at the letter but at the substance of the agreement.
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It has to be ascertained whether under the terms of the
contract the parties named a specific time within which
completion was to take place, really and in substance it was
intended that it should be completed within reasonable
time.''
17.Therefore, from the above principles laid down by the Hon'ble
Apex Court, time would be an essence of the Contract, when time is
specifically stipulated or it clearly emerges by way of implication.
18. The learned counsel for the defendant also placed reliance on the
observation made by the Hon'ble Apex Court in K.S.Vidyanadam vs.
Vairavan reported in AIR 1997 SCC 1751 which reads as follows:
''The rigor of the rule evolved by Courts that time
is not of the essence of the contract in the case of
immovable properties evolved in times when prices and
values were stable and inflation was unknown requires
to be relaxed, if the modified, particularly in the case of
urban immovable properties. It is high time, the Court
do so. In the instant case may be, the parties knew of the
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circumstance regarding rising prices but they have also
specified six months as the period within which the
transaction should be completed. The said time-limit
may not amount to making time the essence of the
contract but it must yet have some meaning. Not for
nothing could such time-limit would have been
prescribed. Can it be stated as a rule of law or rule of
prudence that where time is not made the essence of the
contract, all stipulations of time provided in the contract
have no significance or meaning or that they are as
good as non-existent? All this only means that while
exercising its discretion, the Court should also bear in
mind that when the parties prescribe certain time-
limit(s) for taking steps by one or the other party, it must
have some significance and that the said time-limits
cannot be ignored altogether on the ground that time
has not been made the essence of the contract (relating
to immovable properties.''
19.In the above legal backgound, we will now look at the terms of the
suit contract dated 02.02.2006. On perusal of EX.A.1 sale agreement, the
agreement reads as follows:-
fPH;f;fz;l brhj;jhdJ 1-tJ ghh;lo; f;F
kl;oy; brhe;jkhfp. mthpd; mDnghfj;jpYk;.
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RthjPdj;jpYk; ,Jehs;tiu ,Ue;J tUtJkhd
fPH;f;fz;l brhj;ij 2-tJ ghh;lo; f;F
U:gha;/15.00.000-- gjpide;J y;lrj;jpw;F Rj;jf;fpuak;
bra;Jf;bfhLg;gjhf xg;g[f;bfhz;L ,jw;F
mr;rhukhf ,d;iwa njjpapy; 1-tJ ghh;lo; 2-tJ
ghh;lo; aplkpUe;J fPHf;fz;l rhl;rpfs; Kd;g[
buhf;fkhf bgw;Wf;bfhz;lj;bjhif
U:gha;/7.00.000-- VG yl;rk; kl;oy;. nkYk; 2tJ
ghh;lo; 25/03/2006-k; njjpapy; nkw;bfhz;L
ml;thd;rhf U:gha;/3.00.000-- K:dW
; yl;rj;ij 1-tJ
ghh;lo; aplk; bfhLj;Jtpl;L ,e;j mr;rhu
cld;gof;ifapy; tut[ itj;Jf;bfhs;s ,jd;Ky: k;
,U ghh;l;ofSk; rk;kjpf;fpwhh;fs;/
,d;W Kjy; 25/05/2006-k; njjp bfLtpw;Fs; 1-tJ
ghh;lo; jd; brhe;j brytpy; fPH;f;fz;l
brhj;jpw;Fz;lhd midj;J Kiwahd
hpf;fhh;Lfisa[k;. tpy;y';f rhd;wpjiHa[k;. gl;lh
rhd;wpjiHa[k; vLj;J Koj;Jk;. fPH;f;fz;l brhj;jpw;F
cz;lhd ,juthpfis fl;o Koj;Jk; ,itfis 2-
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; 2-tJ ghh;lo; f;nfh
tJ ghh;lo; aplk; xg;gilj;JtplL
my;yJ mth; Fwpg;gpLk; egh;fSf;nfh 2-tJ ghh;lo; apd;
brytpy; fpuag;gj;jpuk; vGjp gj;jpuk; gjpthFk;nghJ kPjp
fpuaj;bjhif U:gha; 5.00.000-- Ie;J yl;rj;ija[k; 1-
tJ ghh;lo; 2-tJ ghh;lo; aplkpUe;J bgw;Wf;bfhs;s
ntz;oaJ/
nkw;Fwpgg; pll; go. nkw;go bfLtpw;Fs; 1-tJ ghh;lo;
fpuak; bra;J bfhLf;fj;jahuhf ,Ue;Jk; 2-tJ ghh;lo;
fpuak; bra;Jf;bfhs;sj;jtwpdhy; jhd; bfhLj;j
mr;rhuj;bjhifia ,He;Jtpl ntz;oaJ/
nkw;Fwpg;gpll; go. nkw;go bfLtpw;Fs; 2-tJ ghh;lo;
fpuak; bra;Jf;bfhs;sj;jahuhf ,Ue;Jk; 1-tJ ghh;lo;
fpuak; bra;Jf;bfhLf;fj;jtwpdhy; 2-tJ ghh;lo; . 1-tJ
ghh;lo; kPJ “!;bgrpgpf; bgh;ghh;k;!; hpyPg; Mf;od;go”
nfhh;l;oy; jhth elj;jp nfhh;ll; hh; K:yk; nry;OL bgw;W
ghf;fp fpuaj;bjhifia nfhh;lo; y; fl;o brhj;ij
jd;trk; RthjPdg;gLj;jpbfhs;s 1-tJ ghh;lo; 2tJ
ghh;;lo; f;F ,jd;K:yk; rk;kjk; mspf;fpwhh;/ fPH;f;fz;l
brhj;ij fpuak; bra;JbfhLf;Fk; njjptiu ntW
vt;tpj tpy;y';fj;jpw;Fk; cl;gLj;Jtjpy;iybad;Wk;
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“,e;jpad; rptpy; rl;lg;go” jd;idj;jtpu ntW ahUf;Fk;
vt;tpj chpika[k; fpilahbjd;Wk; 1-tJ ghh;lo;
cWjpTWfpwhh;/ fPHf;fz;l brhj;ij fpuak;
bra;Jf;bfhLf;Fk; njjpad;nw 1-tJ ghh;lo; 2tJ
ghh;lo; apd; RthjPdj;jpw;F xg;gilj;Jtpl ntz;oaJ/
,g;go ,U ghh;lo; fSk; nrh;e;J rk;kjpj;J
vGjpf;bfhz;l fpua mr;rhu cld;gof;ifg; gj;jpuk;/
,ijg;nghd;W ,U gpujpfs; jahhpj;J ghh;lo; f;bfhd;whf
itj;Jf; bfhs;sg;gl;lJ/
20.At the outset, this Court has perused Ex.A.2 sale agreement which
is in two parts. The first part provides for the purchaser's obligation, while the
second part details the obligation of the vendor to provide and execute the
sale deed. Although, both the obligations were required to be completed
within the stipulated period of three months. There is a subtantive difference
between these two sets of obligations. The obligation upon the vendor
concern was to produce all the revenue records and also to pay the necessary
Tax for the property. Whereas the obligation on the purchaser, was to make
the complete payment of the sale consideration within three months. The
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agreement further mandates forfeiture of the advance amount if the payment
obligation is not met within the time period stipulated therein.
21.Therefore, from the terms of the Contract it is clear that there was
an obligation on the part of the plaintiff to pay a sum of Rs.8,00,000/- on or
before 25.05.2006. Stipulating a fixed time for payment of balance sale
consideration of Rs.8,00,000/-, failure to do so would render the Contract
vitiated. It would constitute a breach of contract by the plaintiff as per
Section 55 of the Contract Act. Section 55 of the Contract Act deals with the
consequences of failure to perform an executory contract at or before the
stipulated time. It provides that,
''When a party to a contract promises to do a certain thing
at or before a specified time, or certain things at or before
specified times, and fails to do any such thing at or-before
the specified time, the contract, or so much of it as has not
been performed, becomes voidable at the option of the
promisee if the intention of the parties was that time
should be of the essence of the contract.''
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22.The evidence on record shows that in the present case, the plaintiff
failed to perform his part of contract within the stipulated time. Therefore, in
view of the aforesaid provisions, the defendant is entitled to rescined the
contract as there was breach of condition, i.e, 'time was the essence'.
Accordingly this point is answered.
Point No.2
23.The next point for consideration is that whether the plaintiff was
always ready and willing to perform his part of Contract. The aforesaid
requirement is one of the essential ingredients under Section 16 of the
Specific Relief Act 1963 which reads as under:
16. Personal bars to relief.--Specific performance of a
contract cannot be enforced in favour of a person.
(a) who has obtained substituted
performance of contract Under Section 20;
or
(b) who has become incapable of
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performing, or violates any essential term
of, the contract that on his part remains to
be performed, or acts in fraud of the
contract, or wilfully acts at variance with, or
in subversion of, the relation intended to be
established by the contract; or
(c) who fails to prove that he has performed or
has always been ready and willing to perform the
essential terms of the contract which are to be
performed by him, other than terms of the
performance of which has been prevented or
waived by the Defendant.
Explanation.--For the purposes of Clause (c),--
(i) where a contract involves the payment of
money, it is not essential for the Plaintiff to
actually tender to the Defendant or to deposit
incourt any money except when so directed by
the court;
(ii) the Plaintiff must prove performance of, or
readiness and willingness to perform, the
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contract according to its true construction.
In this context, the Hon'ble Supreme Court in Civil Appeal No.5822 of
2022 (arising out of SLP (C) No.13565 of 2021), Civil Appeal No.5823 of
2022 (arising out of SLP (C) No.19920 of 2021) and Civil Appeal No.5824
of 2022 (arising out of SLP (C) No.19286 of 2021) held as under:
28. Clause (c) of Section 16 of the Act, which is relevant in
the instant case, though amended w.e.f. 01st October, 2018
clearly states that unless the Plaintiff establishes his
readiness and willingness to perform his part of the
contract, he would not be entitled to a decree of specific
performance. Prior to the amendment, the expression "who
fails to aver and prove" was on the statute book and its
substitution by the words "who fails to prove" does not bring
about any drastic change to the object and intent of the
clause. This is because failing to prove readiness and
willingness to perform the essential terms of the contract
would first require averments to that effect to be made in the
plaint by the Plaintiff. The absence of such averments
regarding readiness and willingness to perform the essential
terms of the contract by the Plaintiff would not permit him to
let In any evidence on that aspect. It is a settled principle of
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law that no evidence can be permitted to be let in the
absence of averments in the plaint/pleadings vide Bachhaj
Nahar v. Nilima Mandal and Ors., MANU/SC/8199/2008:
(2008) 17 SCC 491. In the said case, a Bench of this Court
speaking through Raveendran J. laid down as follows:
(i) No amount of evidence can be looked into, upon a plea
which was never put forward in the pleadings. A question
which did not arise from the pleadings and which was not
the subject matter of an issue, cannot be decided by the
Court.
(ii) A Court cannot make out a case not pleaded. The Court
should confine its decision to the question raised in
pleadings. Nor can it grant a relief which is not claimed and
which does not flow from the facts and the cause of action
alleged in the plaint.
29. Therefore, notwithstanding the amendment to Section 16
of the Act whereby the expression "who fails to aver and
prove" has been substituted with the phrase "who fails to
prove," the law remains that no evidence can be let in on a
plea that was never put forward in the plaint/pleadings. But,
it is necessary to sound a caveat. Even the absence of the
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words "ready and willing to perform the contract" in the
plaint would now not have an adverse impact on the
Plaintiff's case, so long as Plaintiff's readiness and
willingness to perform the essential terms of the contract
could be gathered on a holistic reading of the plaint.
30. In fact, even in relation to the earlier scheme of Section
16 of the Act which required a Plaintiff seeking the remedy
of specific performance to 'aver and prove' that he was
ready and willing to perform his obligations under an
agreement, this Court had observed that it was sufficient if
the averments in substance indicate continuous readiness
and willingness on the part of the person suing, to perform
his part of the contract vide Motilal Jain v. Ramdasi Devi,
MANU/SC/0438/2000: A.1.R. 2000 SC 2408 Further, it had
been declared that language in Section 16(c), as it stood
prior to the Amendment Act of 2018, did not require any
specific phraseology to be followed in relation to the
averments as to readiness and willingness. That the
compliance of requirements of readiness and willingness
have to be in spirt and substance and not in letter and form
vide Syed Dastagir v. T.R. Gopalakrishna Shetty,
MANU/SC/0471/1999: (1999) 6 SCC 337.
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That is why the deletion of the words "who fails to aver in
Section 16(c) of the Act does bring about any real change in
the position of law as it stood prior to the amendment.
31. Further, readiness and willingness cannot be considered
in a straitjacket formula; it has to be inferred on a
consideration of the entire facts and circumstances of each
case and the intention and conduct of the parties concerned.
Even if a party to the contract is ready and has the requisite
funds he may not be willing to perform his part of the
contract and vice versa.
32. In this regard, reference may be made to the decision of
this Court in His Holiness Acharya Swami Ganesh Dassji v.
Sita Ram Thapar, MANU/SC/0522/1996: (1996) 4 SCC 526
wherein this Court made a distinction between 'readiness'
and 'willingness' and the manner in which the said
parameters are to be scrutinised in deciding a suit for
specific performance. The relevant findings of this Court are
extracted as under:
2. There is a distinction between readiness to
perform the contract and willingness to
perform the contract. By readiness may be
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A.S.No.326 of 2011
meant the capacity of the Plaintiff to perform
the contract which includes his financial
position to pay the purchase price. For
determining his willingness to perform his
part of the contract, the conduct has to be
properly scrutinised.
The factum of readiness and willingness to perform
Plaintiffs part of the contract is to be adjudged with
reference to the conduct of the party and the attending
circumstances. The court may infer from the facts and
circumstances whether the Plaintiff was ready and was
always ready and willing to perform his part of the contract.
The facts of this case would amply demonstrate that the
Petitioner/Plaintiff was not ready nor capacity to perform
his part of the contract as he had no financial capacity to
pay the consideration in cash as contracted and intended to
bite for the time which disentitles him as time is the essence
of the contract.
Thus, both readiness as well as willingness have to be
established by the Plaintiff on whom the burden is cast in a
suit for specific performance of an agreement. Therefore,the
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A.S.No.326 of 2011
question would arise as to whether the Plaintiff discharged
such burden in theinstant case.
33. Further, in J.P. Builders v. A. Ramdas Rao,
MANU/SC/0977/2010: (2011) 1 SCC 429, this Court held as
under, as regards the onus on a Plaintiff claiming the relief
of specific performance, to prove that he had complied with
Section 16(c) of the Act and had demonstrated 'readiness'
and 'willingness to carry out his obligations under the
agreement of sale:
25. Section 16(c) of the Specific Relief Act, 1963
mandates "readiness and willingness" on the
part of the Plaintiff and it is a condition
precedent for obtaining relief of grant of specific
performance. It is also clear that in a suit for
specific performance, the Plaintiff must allege
and prove a continuous "readiness and
willingness" to perform the contract on his part
from the date of the contract. The onus is on the
Plaintiff.
27. It is settled law that even in the
absence of specific plea by the opposite party, it
is the mandate of the statute that Plaintiff has to
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A.S.No.326 of 2011
comply with Section 16(c) of the Specific Relief
Act and when there is non-compliance with this
statutory mandate, the Court is not bound to
grant specific performance and is left with no
other alternative but to dismiss the suit. It is also
clear that readiness to perform must be
established throughout the relevant points of
time. "Readiness and willingness" to perform the
part of the contract has to be
determined/ascertained from the conduct of the
parties.''
24.Therefore, in a suit for specific performance, the plaintiff has to
prove with satisfactory evidence that he was always ready and willing to
perform his part of Contract at all material time as mandatorily required under
Section 16 (c) of the Specific Relief Act 1963.
25.In the present case, the analysis of evidence would point out that the
plaintiff was not willing to pay the balance amount of Rs.8,00,000/- unless
vacant delivery handed over to the plaintiff after vacating the person in
occupation of a portion of the suit property. Though the time was stipulated
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A.S.No.326 of 2011
in the sale agreement that the sale transaction should be completed on or
before 25.06.2006, there is no evidence to show that the plaintiff was always
ready and willing to pay the balance sale consideration and complete the sale.
The notices which were exchanged between the parties have to be looked into
in determining readiness and willingness. It was the defendant who first
caused the legal notice on 21.09.2006 (Ex.A.3) calling upon the plaintiff for
registering the sale deed. The plaintiff responded to the said notice only on
05.12.2006 (Ex.A.4) after lapse of 2 ½ months. Only in the reply notice, the
pliantiff insisted the defendant that he will be willing to purchase the property
only after removal of the thatched hut put up by a third party in a portion of
the suit property. If really the plaintiff was willing to purchase the suit
property, even before the expiry of the time stipulated in the agreement, he
would have caused legal notice to the defendant calling upon him to hand
over vacant possession and complete the sale transaction. The insistance of
the plaintiff to remove the thatched hut put up by a third party before the
payment of balance sale consideration could only be regarded as trying to
vary the terms of the agreement. It is clear that the plaintiff did not
voluntarily adhere to the time stipulation under the contract. In order to by-
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A.S.No.326 of 2011
pass the condition of time being the essence, the plaintiff invoked the
standard of good faith. Aforesaid standard prescribes a higher duty of care for
parties entering into a contract. Unless such duty is expressly stipulated, good
faith standard cannot be implicitly read into any contract.
26.This Court does not subscribe to acceptance of a general standard of
good faith to imply broader good faith obligations only to give a go-by to the
explicit conditions for maintaining the sanctity of contract. Such broad
standards will have potentially far reaching consequences. On the whole, the
transaction failed primarily on account of non payment of balance sale
consideration on or before 25.06.2006. The fact that the plaintiff deposited
the balance sale consideration would alone not be sufficient to establish his
readiness to perform his part of Contract. The conduct of the plaintiff would
prove that he is not willing to perform his part of contract until the person in
possession is vacated.
27.In the light of the above, it is clear that Section 16(c) of the Specific
Relief Act would only come into force if the purchaser was ready and willing
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A.S.No.326 of 2011
to perform the contract within the three month period prescribed under the
agreement. In light of the fact that there is nothing on record which would
demonstrate any step taken by the plaintiff to pursue the agreement, untill
05.12.2006, on which date, the reply notice was issued by the plaintiff
responding to the notice issued by the defendant on 21.09.2006 calling upon
the plaintiff to perform his part of contract over the suit property. No
explanation has been provided as to why the plaintiff has not caused any legal
notice prior to his reply notice calling upon the defendant to remove the
encumbrance in the suit property and to complete the same. Only after
receiving the legal notice issued by the plaintiff on 21.09.2006, the plaintiff
by way of reply has stated that unless the person in occupation of the portion
of the suit property is vacated, he would be able to complete the sale
transaction. Such conduct of the plaintiff certainly not reflective of
willingness, in terms of Section 16 (c) of the Act. From the conduct of the
plaintiff, we can safely conclude that the purchaser was not ready or willing
to perform his part of the contract within the time stipulated and accordingly,
specific performance cannot be granted.
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A.S.No.326 of 2011
28.Under Section 20 of the Specific Relief Act, grant of specific
performance of contract is discretionary. Though under Section 20 of
Specific Performance Act, the decree for specific performance is
discretionary, yet the Court is not bound to grant such a relief merely because
it is lawful to do so.
29.At this juncture, whether it would be justified to award an additional
amount of consideration to the seller, at the discretion of the Court,
considering the increase in market value of the property from the date of
contract. While I am mindful of the fact that Courts may grant such a relief to
balance equities. But such a decree would be warranted only in cases where
the plaintiff satisfactorily establishes compliance with Section 16 of the Act.
That the measure of enhancement of compensation may be awarded at the
discretion of the Court only if insufficiency of compensation is the only
impediment to ensuring equity and preventing undue gain to one party. In the
absence of compliance with the elementary requirements of Section 16 of the
Act, enhancement of compensation cannot be employed as a device to allow
specific performance in cases where the plaintiff has not perfromed his
obligations under the contract as in the instant case.
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A.S.No.326 of 2011
30. It is therefore, patently clear that the respondent has failed to prove
his readiness and willingness 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. Therefore, this Court finds that the
plaintiff was not entitled to the relief of specific performance. The trial Court
erred both in law and on facts in granting such relief. Accordingly, this point
is answered.
Point No.3
31.The plaintiff has filed Cross Objection No. 188 of 2011 stating the
trial Judge erred in refusing to award the cost in favour of the plaintiff/Cross
Objector, without assingning any reason, when there was no fault on his part.
The defendant has categorically admitted in his evidence about the illegal
occupation by a third party in a portion of the suit property. No doubt, the
defendant is liable to hand over vacant possession to the plaintiff to complete
the sale transaction. However, the defendant failed to take steps to vacate the
person in occupation of the suit property. Hence, the plaintiff is unable to
fulfil his part of contract. Therefore, considering the facts and circumstances
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A.S.No.326 of 2011
of the case, this Court thinks fit that the plaintiff is entitled for the cost of the
suit. Accordingly, this point is answered.
Point No.4
32.This Court is of the firm opinion that the contract was breached due
to the conduct of the plaintiff, who is not willing to perform the contract after
entering into a time sensitive agreement. In any case, it is an admitted fact
that plaintiff had paid only part consideration. Though there is a forefeiture
clause in the agreement, this Court with a view of rendering complete justice
between the parties, deems it appropriate to direct the defendant to repay the
said amount with interest at 12% per annum from the date such payment was
made by the plaintiff to the defendants, till the entire amount is paid back
within a period of three months from the date of receipt of a copy of this
order. If the said amount is already deposited into Court to the credit of the
suit account, the defendant is directed to pay the interest at the rate of 12%
per annum from the date of such payment was made by the plaintiff to the
defendant, till the date of deposit into Court to the credit of the suit account
within a period of three months from the date of receipt of a copy of this
order. The defendant is also directed to pay the plaintiff, the cost incurred by
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A.S.No.326 of 2011
the plaintiff as stated in the cross objection.Accordingly, this point is
answered.
33. In the result, the appeal and the cross objection are allowed on the
above terms. The impugned judgment and decree of the trial Court are
accordingly set aside. Consequently, the connected miscellaneous petition is
closed.
18.04.2023
vsn
Internet:Yes/No
Index:Yes/No
Speaking/Non-speaking order
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A.S.No.326 of 2011
K.GOVINDARAJAN THILAKAVADI, J.
vsn
PRE- DELIVERY JUDGEMENT MADE IN
A.S.No.326 of 2011
and
Cross Obj.No.188 of 2011
and M.P.No.1 of 2011
18.04.2023
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