Punjab-Haryana High Court
Maj. Sudhir Narula vs Sharu Ram And Others on 4 February, 2025
Neutral Citation No:=2025:PHHC:016148
RSA No.376 of 1991
IN THE HIGH COURT OF PUNJAB AND HARYANAAT CHANDIGARH
**********
RSA No.376 of 1991
Reserved on: 29.01.2025
Pronounced on: 04.02.2025
Major Sudhir Narula .... Appellant
Versus
Sharu Ram through its LRs and others ....Respondents
CORAM: HON'BLE MR. JUSTICE DEEPAK GUPTA
Present: Mr. Gurpreet Singh Kahlon, Advocate
for the appellant.
Mr. Manuj Chadha, Advocate for the
Respondents.
****
DEEPAK GUPTA, J.
J Present Regular Second Appeal has been filed by the plaintiff of the case against judgment dated 21.09.1990 of the First Appellate Court of Learned Additional District Judge, Gurugram, upholding the judgment dated 24.11.1988 of the Trial Court, dismissing the suit filed by the plaintiff (appellant herein) seeking decree for specific performance of agreement to sell dated 11.02.1981 in re respect spect of suit land situated in District District Gurugram.
2. Trial Court record was called. Same has been perused. In order to avoid confusion, parties shall be referred as per their status before the Trial Court.
3.1 Admittedly, an agreement to sell dated 11.02.1981 (Ex.P-6)
6) was executed between plaintiff -Major Sudhir Narula (appellant herein) and defendant No.1 - Sharu Ram (respondent respondent No.1 herein through his LRs),, regarding sale of suit land for consideration of `18,150/-.. An Page No.1 out of 19 pages 1 of 19 ::: Downloaded on - 05-02-2025 07:36:13 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 amount of `500/- was paid by the plaintiff to defendant No.1 as earnest money. Target date for execution/ registration of sale deed was agreed to be 31.07.1981, 31.07.1981 on which the remaining sale consideration was to be paid. Usual default clauses were also incorporated in the agreement to the effect that in case the proposed vendee fail fails to get the sale deed executed and registered in his favour up to the ttarget arget date, the earnest money paid by him shall stand forfeited forfeited; whereas, in case the vendor fails to execute and get the sale deed registered, then the vendee will have the right to get the sale deed executed through the process of the Court.
3.2 As per plaintiff, he approached the defendant - vendor several times to get the sale deed executed in his favour but was put off. He also met the defendant No.1 o.1 on 24.6.1981 for getting the sale deed executed and registered as the stipulated date of 31.07.1981 was approaching near but defendant No.1 Sh Sharu ru Ram told the plaintiff that he was not keeping good health and further assured that the date of 31.07.1981 as mentioned in the agreement had no meaning whatsoever and that the time for execution of the sale de deed ed shall be deemed to have been extended and that he (Sharu (S Ram) shall have no objection for getting the sale deed executed and registered at any time. Plaintiff submits that thereafter, thereafter he remained on active army duty and ultimately approached the defendant ultimately, dant No.1 on 226.07.1984 .07.1984 for getting the sale deed executed and registered but defendant No.1 offered to return the money of `500/- informing that he had already given the suit land to his sons by way of some family settlement. Sons of defendant No.1 were impleaded as defendants No.2 to 6. The suit for specific performance was filed on 30.07.1984 i.e. the last date before expiry of the limitation period.
3.3 Defendants contested the suit admitting the execution of No.1 having received `500/- as the agreement to sell and defendant No. Page No.2 out of 19 pages 2 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 earnest money but submitted that 31.07.1981 was the last date for execution and performance of agreement to sell but plaintiff failed to perform his part of contract, contract as he did not appear in the office of Sub Sub--
Registrar on that day, d though defendant Sharu Ram was always ready and willing to t perform his part of contract and had appeared in the office of Sub-Registrar Sub Registrar on 31.07.1981 for executing the sale deed and waited for the plaintiff whole of the day but he never turned up. Defendant No.1 further denied that last date for execution of the sale deed was ever extended as is claimed by the plaintiff and further submitted that amount of `500/- paid as earnest money stood forfeited and so, there was no question of specific performance of the agreement. It was also submitted that the suit land was already partitioned between defendant No.1 and his sons - defendants No.2 to 6 by virtue of a judgment and decree dated 01.05.1984.
3.4 Necessary issues were framed. Evidence produced by the parties was taken on record. Trial Court found that the p plaintiff laintiff has not been ready and willing to perform his part of contract and it was the plaintiff, who had committed the breach of contract. It was also held that the earnest money stood forfeited. Based upon the finding on these material issues, the suit was dismissed. The First Appellate Court affirmed these findings.
4. Assailing the aforesaid concurrent findings of the C Courts ourts below, it is contended by learned counsel for the appellant appellant-plaintiff plaintiff that time is not the essence of the contract for sale of immovable property and that delay in filing the suit for specific performance in itself cannot be ground to reject the claim. It is further contended that mere mentioning of some date or time in an agreement does not mean that the time was the essence of of the contract. Still further further, it is contended that failure to execute the agreement to sell by 31.7.1981 simply meant the earnest money to have been forfeited but it did not mean that Page No.3 out of 19 pages 3 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 agreement was deemed to have been cancel cancelled.
ed. Contending that Courts
ourts below have failed to appreciate the factual and legal position in the right perspective, prayer is made to set aside the impugned judgments and to decree the suit of the appellant appellant-plaintiff, by allowing this appeal.
5. Refuting the aforesaid content contentions, it is argued by learned counsel for the respondents-defendants respondents defendants that there is no scope for interference in the concurrent findings of the facts recorded by the Courts ourts below to the effect that the plaintiff was not ready and willing to perform his part par of contract. It is specifically pointed out that suit was filed just on the last date before the expiry of limitation for filing the suit for specific performance and, therefore,, the C Courts ourts below have rightly declined the discretionary discretion relief of speci specific fic performance. Prayer is accordingly made for dismissal of the appeal.
6. This Court has considered the submissions of both the parties and has appraised the entire record carefully.
7. Execution of the agreement to sell dated 11.2.1981 for total sale consideration of `18,150/- is not in dispute. It is further not in dispute that only an amount of `500/- (approx.2.75 2.75 % of total agreed sale consideration) was paid as earnest money and the target date for the execution of the sale deed was fixed as 31.07.1981. As per the default clauses, in case the vendee failed to get the sale deed executed in his favour, favour the earnest money was to be forfeited forfeited; whereas, in case the vendor endor failed to execute and get the sale deed registered, then the vendee was given the right to get the sale deed executed through the process of the Court and in that eventuality, all the expenses were to be borne by the vendor. The suit has been filed on 30.07.1984 i.e. the last date on which the limitation to file the suit for specific performance was to expire.
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8. Plaintiff claims that prior to 31.7.1981 i.e. target date, he approached the vendor defendant several times to get the sale deed executed d but he was put off. It is also claimed that he met the defendant on 24.6.1981 for getting the sale deed executed and registered but defendant had assured that 31.7.1981 may be deemed to have been extended and that he will execute the sale deed on any da date te as per the convenience of the plaintiff. To prove this assertion, the plaintiff has relied upon a letter dated 26.6.1981 (Ex.P-7).. In the said letter, there is a reference of the meeting between plaintiff and defendant No.1 on 24.6.1981 and that defend defendant ant had assured to get the sale deed executed at any time convenient to the plaintiff.
9. The above-said said contention apart from the contention that the time was not the essence of the contract of sale of the property, were considered by the First Appellate Court and it was observed as under :-
"17. In any case, where time is not essence of the contract of sale of immovable property, the prospective vendee must always be ready and willing to perform his part of the contract and even if it is to be deemed eemed that time will extend it could be extended only to a reasonable limit.
18. Here 31.7.1981 were stipulated as the last date before or on which the parties were to perform their respective part of the contract. The plaintiff now claims that he approached the defendant No.1 who told him that he was not keeping well and he should take it that he could get the sale deed executed any time even after 31.7.1981 31.7.1981,, meaning thereby that the time was extended. The agreement between the parties in this case case was reduced to writing Ex.P.6. The plaintiff is a senior officer of the Indian Army and he must be a well-- educated person. Apart from himself himself, he has not examined any person who could state that the time was extended by Sharu Ram. Suffice it to say that that oral evidence of an interested person cannot cut much ice.
Page No.5 out of 19 pages 5 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 Statement made by the plaintiff in his own favour orally would not further his case. If time was actually extended why a writing was not made in that behalf on the reverse of the agreement Ex.
Ex.P.6 P.6 or on a separate piece of paper? That is a question for which the plaintiff plaintiff--
appellant.
19. Ex.P.7 which purports to be a copy of letter dated 26.6.1981 written by the plaintiff to defendant Sharu Ram has been relie relied upon heavily. In this letter, letter he referred to a meeting with defendant Sharu Ram m on 24.6.1981 and other exigencies including a reference that said defendant had told that plaintiff could come and have the sale deed executed in his favour according to his convenience at any time. Here is a case where plaintiff-appellant plaintiff appellant cleverly enough thought it necessary to retain a typed copy of letter allegedly written by him to the defendant but never insisted on getting a writing made regarding extension of time by the defendant. There is in fact no proof oof that any letter, of which Ex. P.7 purports to be a copy, was actually written by plaintiff to Sharu Ram.
Ram Plaintiff's laintiff's stand is that the letter was sent by ordinary post. A person of his status and education will certainly be awar aware that no proof of posting posting the letter by ordinary post shall be required. It is rather interesting to note that a copy of the letter was retained according to the plaintiff's case but he did not think it proper to send the letter by registered post or at least under certificate of posting. Why a copy should have been retained is again a circumstance which rather leads to very strong suspicions. It appears that Ex.P.7 has been created by way of evidence. Such acts of overdoing, more often than not, give insight into the real facts facts and bring to fore the cleverness of the party concerned although this crude attempt of cre creating ting evidence shaallll not take the plaintiff anywhere and must fail him.
20. It will be easiest thing for a party p rty to ssay that a letter was posted by ordinary post po and to produce copy thereof prepared according to its own sic. and nd convenience. Unless it is shown by documentary evidence or at least compelling circumstance that a letter was actually written and the copy of its true copy, co it will not further case of suc such party."
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10. It is thus clear from the above above-said observations of the First irst Appellate Court that though the plaintiff relied upon the letter dated 26.6.1981 (Ex.P-7) (Ex. 7) but the same was simply sen sent by the ordinary post.
Defendant Sharu Ram examined as DW Defendant- DW-3 3 has denied having received any such letter. He has further denied that plaintiff or anybody on his behalf ever met him in June, 1981. Learned first Appellate Court has rightly observed that in case plaintiff had met the defendant on 24.6.1981 as is claimed claimed by him, there was no reason not to get an endorsement on the back of the agreement Ex.P Ex.P-6 or on a separate paper regarding the extension of time, but this was not done. Similarly, it does not appeal to the reason that the plaintiff will simply send the letter by ordinary post for the extension of time and will keep a copy thereof with him and will not send such an important letter either through registered post or under certificate of posting.
11. In the above circumstances,, the Courts below have rightly ignored Ex.P-7 Ex.P 7 and have rightly disbelieved the version of the plaintiff. It has also been found by the Courts below that defendant No.1 No.1- Sharu Ram had appeared in the office of Sub-Registrar Sub Registrar on 31.07.1981 i.e. the target date fixed for execution of the agreement. After waiting for the plaintiff, he had moved an application Ex.D Ex.D-2 2 for marking his presence and on that, that order Ex.D-11 was passed by the Sub Sub-Registrar, as per which case was called several times but the plaintiff i.e. vendee had not appeared ared on that date.
12. In the above said d facts and circumstances, the C Courts ourts below have rightly concluded that the plaintiff was no not ready and willing to perform his contract and that it is the plaintiff plaintiff, who breached the contract.
13. Apart from above, High Court cannot interfere in the findings of the facts recorded by the Courts ourts below including the findings based on the evidence, evidence even on the ground of the same being Page No.7 out of 19 pages 7 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 erroneous, however, gross are inexcusable inexcusable. In this regard, reference may be made to Randhir Kaur vs. Prith Prithvi Pal Singh (2019) 17 SCC 71,, wherein it has been held by the Hon'ble Supreme Court as under ::-
"9.The The first and the foremost question aris arising in respect of scope of interference in second appeal in Punjab and Haryana is governed by Section 41 of the Punjab Act. Prior to amendment in the Code of Civil Procedure vide CPC (Amendment) Act, 1976 w.e.f. 1-2-1977,, the scope of interference in second appeal under the Punjab Act as well as under the Code of Civil Procedure as it existed before the amendment was on similar grounds. Section 41 of the Punjab Act and Section 100 CPC as it existed prior to 1-4-1977 reads as under:
Section 41 of Punjab Act Section 100 of CPC
41. Second appeals--(1) appeals An appeal shall lie 100
100. Second Appeal.-- (1). Save where to the High Court from every decree passed otherwise expressly provided in the in appeal by any Court subordinate to the body of this Code or by any other law High Court on any of the following grounds, for the time being in force, an appeal namely : shall lie to the High Court from every decree passed in appeal by any court subordinate to a High Court on any of the followin following grounds, namely:
(a) the decision being contrary to law or to (a) the decision being contrary to law some custom or usage having the force of or to some usage having the force of law; law;
(b) the decision having failed to determine (b) the decision having failed to some material issue of law or custom or determine some material issue of law usage having the force of law; or usage having the force of law;
(c) a substantial error or defect in the (c) a substantial error or defect in the procedure provided by the Code of Civil procedu procedure re provided by this Code or by Procedure 1908 [V of 1908], or by any any other law for the time being in other law for the time t being in force which force, which may possibly have may possibly have produced error or defect produced error or defect in the in the decision of the case upon the merits; decision of the case upon the merits.
Page No.8 out of 19 pages 8 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 (2) An appeal may lie under this section (2) An appeal may lie under this from an appellate decree passed ex parte. Section from an appellate decree passed ex parte.
10. The effect of the Constitution Bench judgment in Pankajakshi vs. (2016) SCC 157 is that in second appeal, the scope of Chandrika, (2016)6 interference within the Punjab and Haryana High Court would be the same as the Code of Civil Procedure existed prior to the 1976 Amendment. The provisions of Section 41 of the Punjab Act and of Section 100 CPC are in pari materia.
XX XX XX XX XX
15. A perusal of the aforesaid judgments would show that the jurisdiction in second appeal is not to to interfere with the findings of fact on the ground that findings are erroneous, however, gross or inexcusable the error may seem to be. The findings of fact will also include the findings on the basis of documentary evidence. The jurisdiction to interfere in the second appeal is only where there is an error in law or procedure and not merely an error on a question of fact.
16. In view of the above, we find that the High Court could not interfere with the findings of fact recorded after appreciation of evidence merely because the High Court thought that another view would be a better view. The learned first appellate court has considered onsidered the absence of clause in the first power of attorney to purchase land on behalf of the Plaintiff Plaintiff; the fact that the plaintiff has not appeared as witness.
17. A perusal of the findings recorded show that the learned first appellate court has returned returned a finding that the plaintiff was ready and willing to perform the contract and that the defendants cannot take plea that they were not aware that Dhanwant Singh was power of attorney holder. Therefore, the findings recorded by the first appellate court cannot be said to be contrary to law which may confer court Page No.9 out of 19 pages 9 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 jurisdiction on the High Court to interfere with the findings of fact recorded by the first appellate court.
18. Learned counsel for the respondents have not raised any argument that the first appellate court has failed to determine some material issue of law which may confer jurisdiction on the High Court to interfere with the findings of fact nor there is any sub substantial stantial error or defect in the procedure provided by the Code of Civil Procedure or by any other law for the time being in force which may possibly have produced error or defect in the decision on meri merits.
ts. Therefore, the High Court was not within its jurisdiction to interfere with the findings of fact only for the reason that plaintiff has failed to prove power of attorney in favour of Dhanwant Singh."
14. Similarly, in Navaneethamm mal vs. Arjuna Chettyy (1996) 6 SCC 166,, it has ha been held by the Hon'ble Supreme Court that interference with the concurrent findings of the Courts ourts below by the High Court under Section 100 CPC must be avoided unless warranted by compelling reasons. In any case, the High Court is not expected to re-- appreciate the evidence just to replace the findings of the Lower Courts. In the case before the Hon'ble Supreme Court, the Lower Appellate Court had appreciated the evidence and confirmed the conclusion of the trial Court that the suit was not barred by limitation. It was held that even on assuming that another review was possible on the re-- appreciation of same evidence, that should not have been done by the High Court, Court as it cannot be said that the view taken by the First irst Appellate Court was based on no material.
15. In Kamal Kumar vs. Premlata ata Joshi and others,, 2019 AIR (SC) 459,, Hon'ble Supreme Court observed that issue of readiness and willingness is the most important issue for considering the grant of specific performance erformance of contract. The said issue having been held by the two Courts below on the appreciation of the evidence against the Page No.10 out of 19 pages 10 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 plaintiff, such finding is binding being essentially question of fact. In this case,, Hon'ble Supreme Court had held as under :
"10.
10. It is a settled principle of law that the grant of relief of specific pe per-
r-
formance is a discretionary and equitable relief. The material que ques-
s-
tions, which are required to be gone into for grant of the relief of sp spe-
e-
cific performance, are First, whether there exists a valid and concluded contract between the parties for sale/purchase of the suit property; Second, whether the plaintiff has been ready and willing to perform his part of contract and whether he is still ready and willing to perform his part as as mentioned in the contract; Third, whether the plaintiff has, in fact, performed his part of the contract and, if so, how and to what eex-
x-
tent and in what manner he has performed and whether such perfo perfor-
r-
mance was in conformity with the terms of the contract; Fourth, whether it will be equitable to grant the relief of specific performance to the plaintiff against the defendant in relation to suit property or it will cause any kind of hardship to the defendant and, if so, how and in what manner and the extent iff such relief is eventually granted to the plaintiff; and lastly, whether the plaintiff is entitled for grant of any other alternative relief, namely, refund of earnest money etc. and, if so, on what grounds.
11. In our opinion, the aforementioned question questions are part of the statu-
u-
tory requirements (See Sections 16 (c)
(c), 20, 21, 22, 23 of the Specific Re-
e-
lief Act, 1963 and the forms 47/48 of Appendix A to C of the Code of Civil Procedure).
Pr ). These requirements have to be properly pleaded by the parties in their respective pleadings and proved with the aid of ev evi-
i-
dence in accordance with law. It is only then the Court is entitled to eex-
x-
ercise its discretion and accordingly grant or refu refuse se the relief of specific performance depending upon the case made out by the parties on facts.
12. In the case at hand, we find that the two Courts below have gone into these questions in the light of pleadings and evidence and recor record-
d-
ed a categorical finding finding against the plaintiff holding that the plain-
n-
Page No.11 out of 19 pages 11 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 tiff was neither ready and nor willing to perform his part of the co con-
n-
tract and, therefore, he was not entitled to claim the relief of specific performance of the contract against the defendants in relation to the suit land. It was also held that the plaintiff was not entitled to claim any relief of refund of earnest money because it was liable to be adjusted as agreed between them.
13. In other words, both the Courts below held that the plaintiff has failed to prove his readiness and willingness to perform his part of the contract. The issue of readiness and willingness, in our view, is the most important issue for considering the grant of specific performance of the contract and the same having been held by th the two Courts be-
e-
low on appreciation of evidence against the plaintiff, it is binding on this Court. It being essentially a question of fact, this Court is not iin-
n-
clined to again appreciate the entire evidence while hearing the appeal under Article 136 of the Constitution. It is more so when we find that the appellant was also not able to point out any material perversity or/and illegality in the finding so as to call for any interference therein by this Court."
Court The above said authority is fully applicable to the facts of present case.
16. Proceeding further, the he contention of learned counsel for the appellant that once suit has been filed within limitation, then the Court has no discretion and is required to pass a decree for specific performance has no merit. Learned counsel has referred to Sughar ar Singh vs. Hari Singh(Dead) (Dead) through L.Rs and others (2021) 17 SCC 705,, wherein it was held that when agreement is found to be duly executed and the he plaintiff is found to be ready and willing to perform his part of contract, the relief for specific performance cannot be denied. It was held that discretion under Section 20 is required to be exercised judiciously, soundly and reasonably. Not to gran grantt the decree for specific performance despite execution of agreement to sell is proved and part sale consideration is proved and the plaintiff is always ready and willing Page No.12 out of 19 pages 12 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 to perform the contract would encourage dishonesty and that in such a situation, the balance should tilt in favour of the plaintiff plaintiff, rather in favour of the defendant executing the agreement to sell while exercising discretion judiciously.
judicious Hon'ble Supreme Court also referred to the amendment to the Specific Relief Act 1963 by which Sect Section ion 10 has been substituted. It was held that though the same is not applicable retrospectively but can be a guide on discretionary relief.
17. I am afraid fraid that the cited authority iss not applicable to the facts of the present case, case as it has been consistently found by the Courts below that plaintiff was not ready and willing to perform his part of contract and this Court finds that there is no justification to interfere in the said concurrent finding of facts recorded by the Courts below, which is based upon proper appreciation of evidence.
18. Apart from above,, the Court cannot ignore that suit has not been filed within the reasonable time after the target date and rather rather,it ,it has been filed just on the last date before the expiry of limitation period. Factual position is not in dispute to the effect that target date for execution and registration of the sale deed was 31.0 31.07.1981 and the suit has been filed on 30.07.1984 i.e. on the last date of the expiry of the limitation. The question question is that whether in the above said facts and circumstances, plaintiff deserves to be granted the relief of specific performance?
19. In the case of Saradamani Kandappan Vs. S. Rajalakshmi 812 Hon'ble Supreme Court has observed and others, 2011 AIR SC (Civil) 812,Hon'ble that the law that 'time was not essence of contract' was evolved long years back, when prices were stable and inflation was unknown. However, these days there is galloping increase in prices of immovable properties. Market Market values of properties are no longer stable or steady and therefore, there is an urgent need to revisit the principle that time is not of the he essence in contracts. It will be apt to reproduce the Page No.13 out of 19 pages 13 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 observations made by Hon'ble Supreme Court in this regard aafter fter referring to a decision in K.S. Vidyanadam and others Vs. Vairavan, (1997) 3 SCC 1, which read as under: -
"27. A correct perspective relating to the question whether time is not of the essence of the contract in contracts relating to immovable proper is given by this court in K.S. Vidyanadam and Others vs. property, Vairavan - (1997) 3 SCC 1 (by Jeevan Reddy J. who incidentally was a member of the Constitution Bench in Chand Rani. This Court observed:
"It has been consistently held by the courts in India, following certain early English decisions, that in the case of agreement of sale relating to immovable property, time is not of the essence of the contract unless specifically provided to that effect. In the case of urban properties in India, it is well-known known that their prices have been going up sharply over the last few decades - particularly after 1973. .........We cannot be oblivious to the reality and the reality is constant and continuous rise in the values of urban properties - fuelled by large scale migration of people from rural areas to urban centres and by inflation. Indeed, we are inclined to think that 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 not modified, particularly in the case of urban immovable properties. It is high time, we do so." (emphasis suppl supplied) Therefore there is an urgent need to revisit the principle that time is not of the essence in contracts relating to immovable properties and also explain the current position of law with regard to contracts relating to immovable property made after 1975, in view of the changed circumstances arising from inflation and steep increase in prices. We do not propose to undertake that exercise in this case, nor referring the matter to larger bench as we have held on facts in this case that time is the essence essence of the contract, even with reference to the principles in Chand Rani and other cases. Be that as it may.
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28. Till the issue is considered in an appropriate case, we can only reiterate what has been suggested in K.S. Vidyanadam (supra) :
(i) Courts, while exercising discretion in suits for specific performance, should bear in mind that when the parties prescribe a time/period, for taking certain steps or for completion of the transaction, that must have some significance and therefore time/period pres prescribed cribed cannot be ignored.
(ii) Courts will apply greater scrutiny and strictness when considering whether the purchaser was `ready and willing' to perform his part of the contract.
(iii) Every suit for specific performance need not be decreed merely becausee it is filed within the period of limitation by ignoring the time limits stipulated in the agreement. Courts will also `frown' upon suits which are not filed immediately after the breach/refusal. The fact that limitation is three years does not mean a pur purchaser chaser can wait for 1 or 2 years to file a suit and obtain specific performance. The three year period is intended to assist purchasers in special cases, as for example, where the major part of the consideration has been paid to the vendor and possession h has as been delivered in part performance, where equity shifts in favour of the purchaser."
20. Taking similar view in the case of U.N. Krishnamurthy (since deceased) through LRs Vs. A.M. Krishnamurthy, 2022 AIR (Supreme 3361 Hon'ble Supreme Court held Court) 3361, d that the fact that limitation is three years does not mean that purchaser can wait for one or two years to file the suit and obtain specific performance. Hon'ble Supreme Court observed as under: -
"38. In this case, we cannot overlook the fact that the ssuit uit property is located in the industrial town of Hosur located about 30/40 kms. from Bengaluru. The Court is obliged to take judicial notice of the phenomenal rise in the price of real estate in Hosur. The proposition finds support from case reported in K.S. .S. Vidyanadam v. Vairavan (supra). To quote this Court "we cannot be oblivious to reality - and (supra).
Page No.15 out of 19 pages 15 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 the reality is constant and continuous rise in the values of urban properties -fuelled fuelled by large scale migration of people from rural areas to urban centres and by inflation."
39. Mr. Venugopal argued that the Plaintiff had only paid an insignificant amount of Rs.10,001/-
Rs.10,001/ as advance when the consideration was Rs.15,10,000/-.
Rs.15,10,000/ . Having paid an insignificant amount the Plaintiff was not entitled to discretionary equit equitable able relief of Specific Performance, as observed by this Court in Saradamani Kandappan v.
18. The relevant paragraph of the S. Rajalakshmi (2011) 12 SCC 18.
judgment of this Court is set out hereinbelow:
hereinbelow:-
"37. The reality arising from this economic change cann cannot ot continue to be ignored in deciding cases relating to specific performance. The steep increase in prices is a circumstance which makes it inequitable to grant the relief of specific performance where the purchaser does not take steps to complete the sale within the agreed period, and the vendor has not been responsible for any delay or non non-performance.
performance. A purchaser can no longer take shelter under the principle that time is not of essence inperformance of contracts relating to immovable property, to cover his delays, laches, breaches and "non "non-readiness".
readiness".
The precedents from an era, when high inflation was unknown, holding that time is not of the essence of the contract in regard to immovable properties, may no longer apply, not because the principle laid down wn therein is unsound or erroneous, but the circumstances that existed when the said principle was evolved, no longer exist. In these days of galloping increases in prices of immovable properties, to hold that a vendor who took an earnest money of say aboutt 10% of the sale price and agreed for three months or four months as the period for performance, did not intend that time should be the essence, will be a cruel joke on him, and will result in injustice. Adding to the misery is the delay in disposal of cases ses relating to specific performance, as suits and appeals therefrom routinely take two to three decades to attain finality. As a result, an owner agreeing to sell a property for rupees one lakh and receiving rupees ten thousand as advance may be required to execute a sale deed a quarter century later by receiving the remaining rupees Page No.16 out of 19 pages 16 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 ninety thousand, when the property value has risen to a crore ofrupees."
40. As argued by Mr. Venugopal, the fact that the suit had been filed after three years, just before expiry of the period of limitation, was also a ground to decline the Respondent Plaintiff the equitable relief of Specific Performance for purchase of immovable property. Mr. Venugopal's argument finds support from the judgments of this Court in P.R. Deb and Associates v. Sunanda Roy (1996) 4 SCC 423; K.S. Vidyanadam v. Vairavan (1997) 3 SCC 1; Manjunath Anandapa v. Tammanasa (2003) 10 SCC 390, Azhar Sultana v. B. Rajamani (2009) 17 SCC 27; Saradamani Kandappan v. S. Rajalakshmi (2011) 12 SCC
18. 41 & 42 Xxxxxxxx.......
43. In Saradamani Kandappan (supra) (supra), this Court reiterated that (i) while exercising discretion in suits for Specific Performance, the Courts should bear in mind that when the parties prescribed a time for taking certain steps or for completion of the transaction, that must have some significance and therefore time/period prescribed cannot be ignored; (ii) the Courts will apply greater scrutiny and strictness when considering whether purchaser was ready and willing to perform his part of the contract tract and (iii) every suit for Specific Performance need not be decreed merely because it is filed within the period of limitation, by ignoring time limits stipulated in the agreement. The courts will also frown upon suits which are not filed immediately after fter the breach/refusal. The fact that limitation is three years does not mean that a purchaser can wait for one or two years to file a suit and obtain Specific Performance. The three year period is intended to assist the purchaser in special cases, as for example where the major part of the consideration has been paid to the vendor and possession has been delivered in part performance, where equity shifts in favour of the purchaser."
21. In the case of P. Daivasigamani Vs. S. Sambandan, 2022 after referring to decisions in the case of K.S. AIR (Supreme Court) 5009,after Vidyanadam and others (supra) ( and Saradamani Kandappan ((supra),, it Page No.17 out of 19 pages 17 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 has been held by Hon'ble Supreme Court that there is distinction between limitation and delay and laches. Limitation is a groun ground d for dismissing a suit, even if the plaintiff is otherwise entitled to specific performance, while delay operates to determine the discretion and exercise under Section 20 of the Specific Relief Act, even if the suit is not dismissed on account of limitation.
limitation. It was held further that not one but several aspects have to be considered when the court, in terms of Section 20 of the Specific Relief Act exercises discretion, guided by judicial principles, sound and reasonable.
22. In the case of Alagammal and others Vs. Ganesan and 502,suit for specific performance was filed another, 2024(1) RCR (Civil) 502,suit 2½ years after the target date fixed in the agreement. It was observed by Hon'ble Supreme Court as under: -
"In the case before us, it is not mere delay. It is a case of total inaction on the part of the plaintiff for 2 1/2 years in clear violation of the terms of agreement which required him to pay the balance, purchase the stamp papers and then ask for execution of sale deed within six months. Further, the delay delay is coupled with substantial rise in prices -- according to the defendants, three times -- between the date of agreement and the date of suit notice. The delay has brought about a situation where it would be inequitable to give the relief of specific performance to the plaintiff." (Emphasis supplied) performance
23. In view of the legal position discussed as above and applying the same to the facts of the present case, this Court is of the view that plaintiff - appellant has been rightly held to be not entitled to the relief of specific performance, having regard to his conduct, who filed the suit three years after the target date fixed for execution of the sale deed i.e. on the last date of limitation. The Court also notices that petty amount of approximately approx 2.75% % of the total sale consideration was paid. In n these circumstances, it will not be a sound exercise of Page No.18 out of 19 pages 18 of 19 ::: Downloaded on - 05-02-2025 07:36:14 ::: Neutral Citation No:=2025:PHHC:016148 RSA No.376 of 1991 discretion so as to grant the relief of specific performance in favour of the appellant-plaintiff.
appellant plaintiff. Even in the case of Sughar Singh (Supra), referred by ld. counsel for the appellant appellant,, it has been held by Hon'ble Supreme Court that the discretion under Section 20 of the Specific Relief Act is required to be exercised judiciously, soundly and reasonably.
24. Same view was also taken by the Hon'ble Supreme Court in Rajesh Kumar vs. Anand Kumar others, (2024) SCC 981 after relying upon K.S. Vidyanadam's case, Azhar A r Sultana's case and Sar Saradamani damani Kandappan's case.
case
25. On account of the entire discussion as above of the legal as well as factual aspects,, this Court does not find any scope whatsoever to interfere in the concurrent findings of facts as recorded by the Courts below, which are found to be based upon proper appreciation of evidence and the legal position.
position. There is no perversity or illegality calling for any interference. As such, such holding the present appeal to be devoid of any merit, merit the same is hereby dismissed.
(DEEPAK GUPTA)
JUDGE
February 04, 2025
Renu
Whether Speaking/ reasoned Yes
Whether Reportable Yes
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