S. Narsimha vs Smt. Geetla Vijaya Lakshmi
2022 Latest Caselaw 2428 Tel

        HONOURABLE SMT. JUSTICE P.SREE SUDHA

                 APPEAL SUIT No.2247 of 2003

JUDGMENT:

1. Challenging the judgment and decree dated 07.08.2003

passed by the learned II Additional District Judge, Ranga Reddy

(for short "trial court") in O.S.No.161 of 2000, whereby and

whereunder the trial court while dismissing the suit filed for

specific performance of the agreement of sale was dismissed,

ordered for refund of Rs.4,00,000/- paid by the appellant-plaintiff

with interest thereon, the present appeal is preferred by the

plaintiff.

2. The contention of the learned Counsel appellant is that the

trial Court erred in holding that the appellant failed to perform

his part of contract and the time of essence of contract. He also

stated that the letters written by the respondents on 21.7.2000

extending period of payment till 15.03.2000 were not filed before

the court. In fact he never received those letters but they were

brought into existence to suit stand of the respondents. The trial

court believed the story of the respondents and held that the

appellant is not ready and willing to perform his part of contract.

In fact the payment of balance amount was subject to

measurement of the land by the respondents. He need not show

physically about cash balance as on that date. He also stated that

in a suit for specific performance granting relief of specific

performance is a rule and refusal is an exception, but the trial

court without appreciating the facts and without assigning any

reasons properly dismissed the suit and thus requested to allow

the appeal by setting the impugned judgment.

3. Heard the arguments on both sides and also perused the

record and also the citations filed by both the Counsel.

For the sake of convenience the parties hereinafter be referred as

plaintiff and defendants as arrayed before the trial court for the

sake of convenience.

4. The plaintiff stated that the defendants are the absolute

owners and possessors of the open land bearing plot No.C/5, in

Survey No.120, admeasuring 2632 Square Yards situated in

Medipalli village, Ghatkesar Mandal of Ranga Reddy District.

Out of the same the defendants sold 450 Square Yards to others

and remaining land was offered to sell to the prospective

purchasers. The plaintiff having come to know of the same

expressed his willingness to to purchase the land subject to

measurement. The defendants also accepted to sell the same @

400/- per Square Yard. Accordingly, an agreement of purchase

was also entered on 23.09.1999. The plaintiff paid Rs.1,00,000/-

towards advance sale consideration on the same day and paid

further amount of Rs.3,00,000/- on 4.1.2000. The defendants

agreed to get the land measured and to execute the registered sale

deed by receiving the balance sale consideration. In spite of his

several efforts the defendants failed to do so. On 04.05.2000 the

General Power of Attorney (G.P.A) holder of the defendant No.1

came to Hyderabad and on his assurance he got prepared the

draft sale deed and also ready with the balance sale

consideration, but the General Power of Attorney holder, under

the pretext of clarifying the boundaries, as they already sold

some part of the land, went away without clarifying the same

and he came to know that at present the available land is only

2580 Sq.Yards. The plaintiff got issued legal notice on 18.5.2000.

The defendants gave reply notice on 29.05.2000 with false

allegations and also returned Rs.4 Lakhs by way of demand

drafts. The plaintiff gave reply on 08.06.2000 and returned the

demand drafts to the defendants and also expressed his ready

and willingness to pay the balance amount. The General Power

of Attorney sent a letter on 25.06.2000 to the plaintiff's counsel

and returned the demand drafts. Again the plaintiff issued reply

notice on 30.06.2000 and returned the demand drafts of Rs.2

Lakhs each. As the defendants failed to register the lands in his

favour and as the plaintiff is ready with the balance sale

consideration on 4.5.2000, he filed the suit for specific

performance of contract. He also stated that the defendants

filed suit for injunction in O.S.No.802/2000 and he filed copy of

the same. He stated that as the defendants are trying to sell

away the suit shcueldle lands to third parties he got the notice

published in Eenadu on 14.7.2000 and on 21.7.2000. He

requested the Court to direct the defendants to execute the

registered sale deed in his favour after receiving the balance sale

consideration, or, in alternative, the Court can execute the sale

deed in his favour and deliver the phyiscal possession.

5. In the written statement filed by the defendant No.1 he

admitted regarding the owenrship of the land in favour of

defendants 1 to 3, be he stated that het the extent of land is only

2580 Square Yards, but not 2632 Square Yards as stated by the

plaintiff. He also disputed the date of agreement and stated that

the agreement was entered on 30.08.1999 when payment of Rs.1

Lakh was paid as token advance, but not on 23.09.1999. He

further stated that the original agreement is not with them and it

is in the custody of the plaintiff , but he has not filed the same to

avoid payment of stamp duty. The agreement was not properly

stamped, as such it is not admissible in evidence and without

filing the same the suit itself is not maintainable. He also stated

that only after measurement of the land the plaintiff mentioned

as 2632 Yards i.e. about 52 Square Yards more than the actual

land available and in fact it was also agreed in the agreement of

sale that the entire sale consideration was to be paid on or before

10.01.2000. The defendants agreed to sell the land as they were in

need of money for their urgent necessities, as such in Clause (2) of

the agreement of sale it was specifically mentioned regarding

payment as 'on or before 10.01.2000' and the agreement of sale

was also executed at the instance of the plaintiff. He extracted

the clause 13 of the agreement of sale as follows:

" If the purchaser fails to obtain the sale deed within time specified above, by paying the balance of the consideration, he shall have no claim whatsoever under this agreement"

6. The defendants further stated that as per Clause-13 of the

agreement the suit itself is not maintainable. It is further stated

that General Power of Attorney Holder of defendant No.1

addressed a letter on 27.01.2000 to the plaintiff to arrange funds

and get the sale deed registered and he finally wrote another

letter on 27.02.2000 by extending time till 15.03.2000, but the

plaintiff failed to do so. The defendants further stated that the

plaintiff not only failed to pay amount within the stipulated time

but also harassing them by publishing the paper notifications, as

such they filed suit for injunction vide O.S.No.802/2000. They

further stated that they are willing to return the demand drafts to

the plaintiff and requested to dismiss the suit.

7. Before the trial Court, the plaintiff examined himself as

PW1 and got marked Exs.A1 to 20 on his behalf. One Ch.Jogi

Reddy, General Power of Attorney of defendant No.1, is

examined as DW1. DW2 is the a private surveyor who measured

the land and his wife is examined as DW3. Ex.B1 is the certificate

dated.27.11.2022.

8. The trial court after considering the oral and documentary

evidence on record, while dismissing the he suit with regard to

specific performance of contract, decreed for the suit for recovery

of Rs.4,00,000/- respectively till the date of realization.

Aggrieved by the same, the appellant-plaintiff preferred the

present appeal.

9. Heard both sides.

10. The plaintiff filed the suit against the defendants basing on

the agreement of sale dated.23.09.1999, but he/PW1 has not filed

the said agreement of sale. In his cross-examination he clearly

admitted that the copy of the agreement of sale is available with

him but he has not filed it in the court for the reasons best known

to him. DW1 also stated that he has xerox copy of the agreement

of sale, but he also not filed the copy of the same. As per the

plaintiff the defendants executed agreement of sale on 23.09.1999,

whereas the defendants stated that it was entered on 30.08.1999.

The extent of the land agreed to be sold is 2682 Square Yards,

and as per the plaintiff and it is subject to measurement, whereas

the defendants stated they have already measured the land and

the available land for sale is only 2580. There is no dispute

regarding the sale of 450 Sq.Yards by the defendants to 3rd

parties under Exs.A-18 to A-20 sale deeds. DW1 stated that the

land was measured two days prior to 30.8.1999 through DW2

and after sale of 450 Sq.yards the land available is 2580 Sq.Yards.

The plaintiff stated that DW1 came to Hyderabad on 4.5.2000

and on his assurance he got prepared the draft sale deed. DW1

in the cross-examination stated that by that date and from

12.5.2000 to 23.5.2000 he was at Hyderabad, but he did not met

the plaintiff during the said period. The trial Court clearly

observed that the plaintiff, who sought for specific performance,

has to establish that there was valid sale agreement entered into

by the defendants in his favour with respect to certain extent of

lands and that he has always been ready and willing to perform

his part to contract and within the time stipulated in the

agreement or within the time extended between the parties to

the agreement or within the period of limitation. Even as per the

plaintiff the agreement was entered on 23.09.1999 and he paid

Rs.4 Lakhs and is ready with the balance sale consideration

subject to measurement of the land and he filed the suit for

specific performance in the August, 2000. He has not issued any

notice to the defendants requesting them to measure the land,

but he filed the suit for an extent of 2632 Square Yards. In fact he

also got prepared draft sale deed for the said extent. The total

total sale consideration was also calculated for the said extent @

400/- per Sq.Yards. But the trial court observed that the plaintiff

filed the suit for the entire extent of 2632 Sq.yards and calculated

the sale consideration, as such he cannot raise issue against the

defendants that the defendants failed to measure the land.

11. The plaintiff also agreed that the balance amount was to be

paid on or before 10.01.2000. Now it is for the Court to see

whether the time is essence of contract, or not?

12. The defendants stated that, as per Clause (13) of the terms of

agreement of sale, the plaintiff failed to pay balance amount on or

before the stipulated period as such he is not entitled for specific

performance of contract. But, DW1, in his evidence, stated that

he addressed letter to the plaintiff on 27.1.2000 asking him to

arrange the amount on or before 15.2.2000 and to get the sale

deed prepared. He he also addressed another letter on 27.2.2000

by extending time till 15.3.2000. When DW1, as G.P.A holder,

extended further time till 15.3.2000 it cannot be said that the time

is the essence of contract. As per the terms of the terms of

contract the plaintiff shall pay entire sale consideration on or

before 10.1.2000, but it was subsequently extended for two times,

as such the time is not essence of contract. The plaintiff further

stated that he was ready and willing to perform his part of

contract and he also filed his statement of account to show that on

12.8.2000 he deposited Rs.7,00,000/- in his account and the

balance amount available was Rs.7,01,112/-. From 9.5.2000 the

amount was reduced to Rs.4,576/- by 22,06,.2000. As on

04.05.2000 the balance amount available was Rs.4,01,506/-. The

trial court observed that the plaintiff should demonstrate by

showing the availability of the money from the beginning till the

date of decree, however, he has not deposed in his evidence that

he has got any other source of income to pay the balance of sale

consideration in his bank account under Ex.,A4. Even according

to the notice under Ex.A5 dated.18.5.2000 by 4.5.2000 he was

ready with cash of Rs.4,00,000/- only. As the plaintiff is seeking

the relief of specific performance of agreement of sale he should

prove that he was ready and willing to perform his part to

contract and that he has financial capacity to pay balance sale

consideration, but failed to prove the same and thus he is not

entitled for relief of specific performance of contract. For said

proposition of law, the learned Counsel for the appellant relaying

on a decision reported in (2008) 11 Supreme Court Cases-45,

contended that the conduct of the defendant cannot be ignored

while weighing the question of exercise of discretion for

decreeing or denying a decree for specific performance.

13. In view of the amendments to the Specie Relief Act, the

learned Counsel appearing for the appellant argued that the

specific relief is specie of law. It is well settled that all procedural

laws retrospective unless the legislature expressly states to the

contrary. It has been held that the procedural laws in force must

be applied at the date when the suit or proceedings comes on for

trial or disposal. The court is bound to take notice of the change

in the law and is bound to administer the law as it was when the

suit came for hearing. The appeal is continuation of suit and if

any changes in law, which has taken place between the date of

decree and the decision of the appeal, has to be taken into

consideration. A change of Law will become applicable on the

date of the appellate decree, provided that no vested right is

taken away thereby, subject to the provisions of Sub-section (2) of

Section 11, Section 14 and 16 of the Specific Relief Act, and the

relief of specific relief of specific performance of a contract, is no

longer discretionary after the amendments.

14. The learned Counsel for the respondent submits that

Section 16 (c) of the Specific Relief Act postulates continuous

readiness and willingness on the part of the plaintiff. It is a

condition precedent for obtaining a relief grant of specific

performance of contract, though it is a discretionary jurisdiction,

the court should consider whether the suit had been filed within

reasonable time and. What would be a reasonable time would,

however, depend upon the facts and circumstances of each case.

15. The learned Counsel appearing for the respondents-

defendants relied on a decision reported in 2007 (5) ALT 510

(DB) in Mohammed Ibrahim and another Vs., Mohammed

Abdul Razak, wherein, their Lordship held that:

" Merely because, there is a mention in the agreement making time as essence of contract, it does not mean that such time is made essence of contract. The court has to decide the the the same while taking into consideration of intention of parties in making such stipulation, their conduct and surrounding circumstances.

16. The learned Counsel for the respondents-defendants further

submitted that, when the burden is on the agreement holder he

should in the first instance plead and prove that the he would

perform or has always been ready and willing to perform his part

of contract, the burden never shifts on the Vendor.

17. The learned Counsel for the respondents further submitted

that it is well settled that in the absence of pleading, evidence, if

any, produced by the parties cannot be considered. It is also

equally settled that no party should be permitted to travel

beyond its pleadings and that all necessary and material facts

should be pleaded by the party in support of the case set up by it.

18. In the case on hand, it is for the court to see whether the

time is essence of contract. It is admitted by the plaintiff that as

per the terms of agreement the amount was to be paid on or

before 10.1.2000. He disputed the letter sent by DW1 extending

time till 15.3.2000, however, the DW1 himself admitted that he

extended time for two times and addressed letters to the plaintiff.

When once the defendants themselves deviated from the terms of

contract and extended time it cannot be said that time is essence

of contract.

19. Now it is for the court whether the plaintiff was ready to

perform his part of contract. Even in the plaint the plaintiff stated

that he paid Rs.1,00,000/- on 23.09.1999 and Rs.3,00,000/- on

04.01.2000 and he was ready with balance sale consideration by

4.5.2000, which clearly shows that he was not ready to pay the

balance amount on the date extended by the defendants till

15.3.2000. The defendants clearly sated that they intended to sell

the property for their urgent finical requirements and also put a

condition in the agreement of sale that the amount to be paid on

or before 10.1.2000. Even then the defendants extended time

twice till 15.3.2000. Even as on that date also the plaintiff was not

ready and willing to perform his part of contract and he has no

financial capacity to pay balance consideration, as such, the trial

court rightly considered the surrounding circumstances and held

that the plaintiff is not entitled for specific performance and

ordered for refund of the amount. There was much

correspondence between the parties. The plaintiff issued legal

notice on 18.5.2000 in which he sated the he paid Rs.1,00,000/- on

23.9.1999 and Rs.3,00,000/- on 4.1.2000 and he got the sale deed

prepared on the instructions of DW1 and he took away the

original agreement of sale and also on the pretext of clarifying the

boundaries he went away, as such he could not pay the balance

amount. In their reply notice the defendants stated that on

30.08.1999 Rs.1,00,000/- was paid and agreement was also

entered on the same day and he denied about his visit to

Hyderabad and also preparing of draft sale deeds at this instance

on 04.05.2000. Regarding extension of time through two letter it

was extended till 15.3.2000, but still the plaintiff failed to pay the

balance amount. As the defendants were in urgent financial

necessities they intended to sell the property, but as the plaintiff

failed to pay the amount within the stipulated time, returned

Rs.4,00,000/- to the plaintiff. In the notice given by the plaintiff

dated. 08.06.2000 he alleged that the defendants failed to get the

land measured and there are boundary issues and he has not

received any letters from the defendants dt.27,01.2000 and

15.03.2000 and the defendants are trying to avoid contractual

obligation. DW1 in the letter dated.25.06.2000 stated that he

cancelled the agreement and questioned the plaintiff about his

authority for asking for measurement of the land and returned

the demand drafts. The plaintiff addressed another letter

dated.30.06.2000 and sent back the demand drafts to the

defendants. During the pendency of the proceedings Defendant

No.1 expired on 03.06.2000. As per Exs.A18 to A-20 sale deeds

executed by the defendants in favour of third parties the sale

consideration is shown as Rs.22,500/-. The plaintiff stated that he

entered agreement with the defendants and also paid token

advance of Rs.1 Lakh on the same day and later he paid

Rs.3,00,000/-, and as the defendants failed to measure the land he

could not pay the balance and he further stated that at the

instance of G.P.A holder of defendant No.1 he got prepared

draft sale deeds on 04.05.2000 and was also ready to willing to

perform his part of contract. Initially, in the agreement the time

for payment of balance sale consideration was on or before

10.1.2000, but later it was extended till1 5.03.2000. Even by that

time also the plaintiff has no financial capacity to pay the amount,

he was not ready to willing to perform his part of contract. He

has not stated that he has any other source of income and in

Ex.A4 bank statement he was not having sufficient funds to pay

the balance amount, as such the trial court observed that the

plaintiff is not intended to perform his part of contract. As the

plaintiff paid Rs.4,00,000/- to the defendants, the trial court

directed the defendants to refund the amount with interest 6%

per annum till the date of decree, till realization. It was also

admitted by the plaintiff that there is no clause in the agreement

regarding the interest. However, considering the fact that the

plaintiff is entitled to the refund of the amount the trial court felt

it just and necessary to grant reasonable interest as per Section 34

of the Civil Procedure Code. The learned Counsel for the

appellant mainly contended that in view of the amendment to

the Specific Relief Act, specific performance of contract is a rule

and refusal is an exception. Admittedly specific performance of

contract is discretionary relief and it should be granted by the

Court after considering the facts on record and the evidence

adduced by both parties. The trial court after considering the

entire evidence on record rightly refused relief of specific

performance and granted refund of amount and the appeal is

devoid of any merit and is liable to be dismissed.

20. Accordingly, this appeal is dismissed, with costs,

confirming the judgment of the trial court passed in O.S.No.161 of

2000 dated.7.8.2003.

As a sequel thereto, miscellaneous petitions, if any,

pending shall stand closed.

_________________ P.SREE SUDHA, J

Date: 08/06/2022 trr