Delhi District Court
Rajinder Singh vs Smt. Krishna Kumari on 13 August, 2012
1
IN THE COURT OF SH. DIG VINAY SINGH
ADDITIONAL DISTRICT JUDGE 04 (CENTRAL) : DELHI.
Date of institution of case : 06.07.2007
Date of reservation of order : 04.08.2012
Date of judgment : 13.08.2012
In re :
CIVIL SUIT NO. 50/11/07
Unique ID no. 02401C0644722007
RAJINDER SINGH
S/O SH. WAKIL SINGH
R/O FLAT NO. 33, SECTOR14,
POCKET II, DWARKA,
NEW DELHI
.... PLAINTIFF
VERSUS
SMT. KRISHNA KUMARI
W/O LATE SH. MUNISH CHANDER
R/O FLAT NO. 102M, ARAM BAGH,
DDA FLATS, PAHAR GANJ,
NEW DELHI110055.
.... DEFENDANT
JUDGMENT
1. The sole plaintiff filed this suit for specific performance of an agreement to sell, dated 01.04.2006, against the sole defendant as also for passing a decree of permanent injunction against the defendant from alienating the property Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 1 of 22 r 2 in any manner.
2. The plaintiff claims that in the month of March 2006, the defendant claiming himself to be the sole, absolute and exclusive owner of property bearing no. 702, Ground Floor, PocketA, Loknayak Puram, New Delhi (hereinafter referred to as the suit property), approached the plaintiff to sell it to the plaintiff. The suit property was claimed to be free from all encumbrances and thus a deal was struck for total consideration of Rs. 5, 25,000/. An agreement to sell and purchase, dated 01.04.2006, was executed and the plaintiff paid an amount of Rs.1 Lakhs as earnest money to the defendant. Remaining amount of Rs.4, 25,000/ was payable, as per para 3 of the plaint within three months. The sale documents were to be executed by the defendant on receipt of entire sale consideration. The plaintiff further claims that on request of the defendant, he paid a sum of Rs.50, 000/ on 23.06.2006 leaving a balance of Rs.3,75,000/ to be paid at the time of execution of documents. Plaintiff claims that it was agreed between the parties that in case, the defendant fails to perform her part of contract, the plaintiff shall be entitled to approach the court of law for getting the documents executed, and in case the plaintiff was to fail in Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 2 of 22 r 3 performing his part of contract, the earnest money was to be forfeited. Plaintiff also avers that the plaintiff had been requesting the defendant time and again to execute the sale documents before the SubRegistrar against receipt of balance sale consideration but the defendant had been avoiding it on one pretext or the other. Allegedly, defendant became dishonest because of steep increase in the rates of property and the defendant was looking for some other purchaser. Allegedly, the defendant also had no clear title to the property, which the plaintiff came to know later on. The plaintiff even served a legal notice on 14.03.2007 calling upon the defendant to receive the balance amount and execute the title documents or to pay a sum of Rs.3 Lakh to the plaintiff as double of the earnest money in the alternative. After receipt of notice, the defendant started threatening the plaintiff to create third party interest and also refused to execute the documents. The plaintiff prays a decree of specific performance of the said agreement and also perpetual injunction against alienation of the suit property.
3. The suit was filed on 06.07.2007. The defendant was served with the summons of suit on 22.08.2007, but initially none Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 3 of 22 r 4 appeared for the defendant and the defendant was proceeded exparte on 20.10.2007. Subsequently, the defendant got the exparte order set aside against her but was again proceeded exparte on 27.3.2008. Once again the order was got set aside and ultimately the written statement was filed on 12.5.2008. Thereafter, again the defendant was proceeded against ex parte on 29.1.2010, and thereafter none appeared for the defendant.
4. In the written statement, the defendant admitted the execution of agreement to sell and receipt of Rs. 1 Lakhs and Rs. 50,000 but the defendant claimed that the property was allotted by DDA on hire purchase basis and thus the defendant was not allowed to transfer the property and hence this court cannot pass any decree for specific performance. The defendant also categorically averred that the suit property had been sold by the defendant to one Jitender Kumar and even possession was handed over to him, even before the institution of the present suit and hence, the plaintiff suit does not lie. Defendant also claimed that at the time of agreement to sell between the plaintiff and defendant, DDA had not raised any demand notice qua the suit property and no demand money was confirmed and even the Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 4 of 22 r 5 possession of the suit property was not given to the defendant by the DDA, therefore, it was agreed to between the parties that the balance amount of Rs.3, 75,000/ would be paid by the plaintiff to the defendant after three months of receipt of demand notice by the defendant from the DDA. At the time of execution of agreement to sell, only one allotment letter was received by the defendant from DDA and there was no demand letter of sale consideration issued by the DDA to the defendant. Hence, the future property which was expected by the defendant to be allotted to her was agreed to be sold and all the payment to the DDA against the property was in fact to be made by the plaintiff as per demand letter of DDA which the plaintiff failed to pay. A demand note of more than Rs. 8 Lakh was received by the defendant from DDA in July 2006 and the defendant gave time to the plaintiff for performance of the contract till 19.10.2006 by a legal notice dated 14.10.2006 but the plaintiff did not make payment and failed to perform his part of contract.
5. Defendant thus claims that it was plaintiff who failed to perform his part of contract and thus the earnest money is liable to be forfeited. Defendant even claims that when the plaintiff failed to perform his part of contract, the defendant Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 5 of 22 r 6 told the plaintiff that she would sell the property to third party but despite that the plaintiff failed to pay the amount.
6. The plaintiff did not file any replication to the written statement filed by the defendant. It would be important to note that the written statement was filed on 12.05.2008 and the copy was supplied to the plaintiff on 14.05.2008 but on subsequent hearings on 24.07.2008, 12.9.2008, 6.11.2008, 16.1.2009 and 20.2.2009, no replication was filed. Subsequently, the defendant was proceeded exparte.
7. Neither any issues were framed in this case, nor were any points for determination framed.
8. The plaintiff in support of his case examined himself as the sole witness. As PW1, he reiterated the averments of the plaint in the affidavit in evidence. We need not repeat the contents of affidavit as it would be mere repetitive. Suffice it to say that the plaintiff proved the agreement to sell as Ex.PW1/2; receipts for Rs.1 Lac and Rs.50, 000/ as Ex.PW1/3 & 4, respectively; the site plan Ex.PW1/1; the legal notice Ex.PW1/5. The postal receipt of legal notice though mentioned as Ex.PW1/6 in the affidavit of the plaintiff, was not exhibited.
9. I have heard Ld. Counsel for the plaintiff and have perused Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 6 of 22 r 7 the record.
10.The relief of specific performance is a discretionary relief which can be granted by the court in its discretion. No doubt, the discretion has to be judicious. In a suit for specific performance of a contract for sale, the issue to be decided is the enforceability of the contract entered into between the parties and whether contract was executed for sale of the contracted property, whether the plaintiff was ready and willing to perform his part of the contract and whether the plaintiff is entitled to a decree for specific performance of a contract for sale against the defendant.
11.In the present case, though the averments of the plaintiff have gone unrebutted and uncontroverted by the defendant who although filed the written statement but did not pursue the matter.
12.It appears that the defendant did not pursue the matter for the reason that the suit property was already sold by the defendant to third party even before filing of this suit, as claimed in the written statement in Para 2 of preliminary objections as well as Para 9 & 10 of the reply on merits. The defendant even claimed that the suit property was sold by the defendant even before receipt of legal notice Ex.PW1/5 Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 7 of 22 r 8 which was sent by the plaintiff to the defendant. Despite the fact that the defendant had named the third party purchaser in the written statement and despite the fact that the address of the third party purchaser was mentioned in the written statement, the plaintiff did not join said Mr. Jitender Kumar as a party in the present suit. Contents of Para 2 of the written statement would reveal that said Mr. Jitender Kumar was also in possession of the suit property as the address of Jitender Kumar was same as that of suit property. Despite this fact having come to the knowledge of the plaintiff, specifically and clearly, the plaintiff did not join Jitender Kumar as party in the suit. Since, Mr. Jitender Kumar acquired title to the property from the same vendor i.e. defendant that too even before institution of the suit, Sh. Jitender Kumar was a necessary party in the present suit.
13. Under Section 19 of the Specific Relief Act, 1963, specific performance of a contract may be enforced against either party to the contract or any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract (emphasis supplied). Thus, against a transferee for value who has paid Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 8 of 22 r 9 his money in good faith without notice of the original contract, a suit for specific performance cannot be enforced. In the present case, Sh. Jitender falls in this exception. Decree in the present suit against the defendant would actually mean decreeing the suit against Jitender Kumar since he is in the possession of the property after having purchased it from the defendant.
14.Under Order 1 Rule 10 CPC, a 'necessary party' is a person who ought to have been joined as a party and in whose absence no effective decree could be passed at all by the Court. If a 'necessary party' is not impleaded, the suit itself is liable to be dismissed.
15. A threeJudge Bench in Kasturi v. Iyyamperumal [2005 (6) SCC 733] : (AIR 2005 SC 2813 : 2005 AIR SCW 2368, held that necessary parties are those persons in whose absence no decree can be passed by the court or those persons against whom there is a right to some relief in respect of the controversy involved in the proceedings; and that proper parties are those whose presence before the court would be necessary in order to enable the court effectually and completely to adjudicate upon and settle all the questions involved in the suit although no relief in the suit was claimed Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 9 of 22 r 10 against such person.
Referring to suits for specific performance, the Court held that the following persons are to be considered as necessary parties: (i) the parties to the contract which is sought to be enforced or their legal representatives; (ii) a transferee of the property which is the subjectmatter of the contract.
The Court concluded that a purchaser of the suit property subsequent to the suit agreement would be a necessary party as he would be affected if he had purchased it with or without notice of the contract.
16.In the present case, the plaintiff failed to join the necessary party without whom the relief claimed in the present suit cannot be granted. Said Mr. Jitender Kumar appears to be a bonafide purchaser of the suit property against valuable consideration and without notice of the present agreement to sell. Thus, he was a necessary party in the suit. As far as relief of specific performance of contract is concerned, the suit is liable to be dismissed on this ground alone.
17. Even otherwise, perusal of the agreement to sell would reveal that a lot of fill in the blanks has been made in the Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 10 of 22 r 11 agreement to sell. A large number of hand written insertion has been made in the agreement to sell, as to the parties between whom the agreement is executed; as to the description of the suit property; as to the total amount consideration; as to the earnest money etc. etc. Although, the plaintiff claims this agreement to be dated 01.04.2006 but there is no date on the agreement to sell to show as to on which date it was executed. The stamp paper appears to have purchased on 13.03.2006 as is clear from the stamp of the stamp vendor on the back side of the stamp paper. The agreement was notarized on 17.05.2006. In the entire agreement, date of 01.04.2006 is missing. The receipt of Rs.1 Lac bears date of 01.04.2006 but again it was notarized on 17.05.2006 only.
18.In order to succeed in a suit for specific performance of a contract, it is necessary that the plaintiff avers and proves that he has performed or that he was always ready and willing to perform the essential terms of the contract which were to be performed by him. In case, a plaintiff fails to aver and prove the same, specific performance of a contract cannot be granted in favour of the plaintiff. Where a statute requires any fact to be pleaded then that has to be pleaded, it Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 11 of 22 r 12 may be in any form, and it cannot be constricted to be only in any particular nomenclature or word. But the plaintiff must aver that he has performed or has always been and is willing to perform his part of the contract. So the compliance of "readiness and willingness" has to be in spirit and substance.
19.In the present suit, in the plaint, the plaintiff has claimed that the plaintiff was requesting the defendant time and again to execute the sale documents and receive the balance consideration amount and that the defendant was avoiding on one pretext or the other. In the affidavit in evidence also, the plaintiff has repeated these averments but the plaintiff failed to adduce any direct or indirect proof to show as to on which dates and time such a request was made by the plaintiff to the defendant. The alleged legal notice sent by the plaintiff to the defendant for performance of contract was sent almost one year after the purported agreement to sell. The legal notice was sent on 14.03.2007 which is proved as Ex.PW1/5 whereas the agreement to sell is claimed to be of 01.04.2006. Besides mentioning of this one Para as to the request of the plaintiff to the defendant, no proof has been adduced by the plaintiff that the plaintiff was ready and willing to perform his part of the contract throughout this period. Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 12 of 22 r 13
20. In Azhar Sultana v. B. Rajamani AIR 2009 SUPREME COURT 2157, it is held, that in view of Section 16(c) of the Specific Relief Act, 1963, the plaintiff was required to make requisite averments that she had all along been and still is ready and willing to perform her part of the contract and also establish the same. In that case it was held that section 16(c) of the Specific Relief Act, 1963 postulates continuous readiness and willingness on the part of the plaintiff. It is a condition precedent for obtaining a relief of grant of specific performance of contract. The court, keeping in view the fact that it exercises a discretionary jurisdiction, would be entitled to take into consideration as to whether the suit had been filed within a reasonable time. What would be a reasonable time would, however, depend upon the facts and circumstances of each case. No hard and fast law can be laid down therefor. Even the conduct of the parties in this behalf would also assume significance.
In that case even the subsequent conduct of plaintiff in delay in impleading third party purchaser of suit property was considered to judge Readiness and willingness on the part of the plaintiff, in Para 17, as follows: Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 13 of 22 r 14 "It may be true that the name of the purchaser was not disclosed but then it was open to the plaintiff to ask for other and better particulars of the said statements. Why she had to wait for a period of more than three years for impleading the subsequent purchasers as parties has not been explained. Even an application for injunction was filed only in September 1985. According to her husband, she came to learn about the sale of property in the name of defendant No. 5 only on 29.9.1986. Why an inquiry was not made in the Registration Office although the deed of sale was a registered one again defies anybody's comprehension. Readiness and willingness on the part of the plaintiff, therefore, is required to be considered from the aforementioned backdrop of events."
21. In AIR 2010 SUPREME COURT 577 A. K. Lakshmipathy (D) and Ors. v. Rai Saheb Pannalal H. Lahoti Charitable Trust and Ors., it was held that it is well settled that in a suit for specific performance of a contract for sale, it has to be proved that the plaintiff who is seeking for a decree for specific performance of the contract for sale must always be ready and willing to complete the terms Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 14 of 22 r 15 of the agreement for sale.
22. In AIR 2008 SUPREME COURT 1786 Bal Krishna v.
Bhagwan Das, it was held as follows:
"Section 16 of the Specific Relief Act, 1963 (hereinafter referred to as "the Act") corresponds with Section 24 of the old Act of 1877 which lays down that the person seeking specific performance of the contract, must file a suit wherein he must allege and prove that he has performed or has been ready and willing to perform the essential terms of the contract, which are to be performed by him. The specific performance of the contract cannot be enforced in favour of the person who fails to aver and prove his readiness and willingness to perform essential terms of the contract. Explanation (ii) to clause (c) of Section 16 further makes it clear that plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction. The compliance of the requirement of Section 16(c) is mandatory and in the absence of proof of the same that the plaintiff has been ready and willing to perform his part of the contract suit cannot succeed. The first requirement is that he must aver in plaint and thereafter Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 15 of 22 r 16 prove those averments made in the plaint. The plaintiffs readiness and willingness must be in accordance with the terms of the agreement. The readiness and willingness of the plaintiff to perform the essential part of the contract would be required to be demonstrated by him from the institution of the suit till it is culminated into decree of the court. It is also settled that by virtue of Section 20 of the Act, the relief for specific performance lies in the discretion of the court and the court is not bound to grant such relief merely because it is lawful to do so. The exercise of the discretion to order specific performance would require the court to satisfy itself that the circumstances are such that it is equitable to grant decree for specific performance of the contract. While exercising the discretion, the court would take into consideration the circumstances of the case, the conduct of parties, and their respective interests under the contract. No specific performance of a contract, though it is not vitiated by fraud or misrepresentation, can be granted if it would give an unfair advantage to the plaintiff and where the performance of the contract would involve some hardship on the defendant, which he did not foresee. In other words, the courts discretion to grant specific performance is Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 16 of 22 r 17 not exercised if the contract is not equal and fair, although the contract is not void."
23. In N. P. Thirugnanam v. R. Jagan Mohan Rao AIR 1996 SUPREME COURT 116, it was held, "To adjudge whether the plaintiff is ready and willing to perform his part of the contract, the court must take into consideration the conduct of the plaintiff prior and subsequent to the filing of the suit along with other attending circumstances. The amount of consideration which he has to pay to the defendant must of necessity be proved to be available. Right from the date of the execution till date of the decree he must prove that he is ready and has always been willing to perform his part of the contract." (Para 5)
24. In Veerayee Ammal v. Seeni Ammal [(2002) 1 SCC 134] it was observed :
" If the plaintiff has failed to establish that she had all along been ready and willing to perform her part of contract, in our opinion, it would not be necessary to enter into the question as to whether the defendant Nos. 5 and 6 were bona fide subsequent purchasers for value without Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 17 of 22 r 18 notice or not.
Furthermore, grant of decree for specific performance of contract is discretionary. The contesting respondents herein are living in the property since 1981 in their own right. There is absolutely no reason as to why they should be forced to vacate the said property at this juncture."
25.The basic principle behind Section 16(c) read with Explanation (ii) is that any person seeking benefit of the specific performance of contract must manifest that his conduct has been blemish less throughout entitling him to the specific relief. The provision imposes a personal bar. The Court is to grant relief on the basis of the conduct of the person seeking relief.
26.Thus, even U/s 16(c) of the Specific Relief Act, 1963, the present relief of specific performance of contract cannot be granted to the plaintiff. Plaintiff ought to have led specific proof to this effect. There is no proof led to show on which dates after the date of agreement to sell, the plaintiff asked the defendant to perform his part of contract. No written communication was sent to the defendant before notice Ex PW 1/5. The very fact that the notice Ex.PW1/5 was sent by the plaintiff to the defendant almost one year after the Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 18 of 22 r 19 alleged agreement to sell reveals that there was lack of willingness to perform his part of contract by the plaintiff himself. It is not proved by the plaintiff as to on which date the defendant received the demand notice from DDA. Thus, assuming that the plaintiff was to perform his part of contract after receipt of demand notice from the DDA by the defendant, the plaintiff ought to have proved as to on which date the DDA issued demand notice. There is no proof to this effect also. There is absolute failure to implead the purchaser Jitender as party in the suit. Thus, the necessary ingredients of Section 16(c) of the Specific Relief Act, 1963 has not been proved by the plaintiff. The suit of the plaintiff seeking specific performance of the contract dated 01.04.2006 is liable to be rejected on this ground also.
27.Once the plaintiff is not entitled to specific performance of contract dated 01.04.2006, the relief of perpetual injunction against the defendant also fails. Even otherwise, as mentioned above the suit property has already been sold by the defendant to Sh. Jitender and even Sh. Jitender has been put in possession of suit property, there is no question of grant of perpetual injunction which has become infructuous.
28.Accordingly, both the prayers of the plaintiff seeking specific Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 19 of 22 r 20 performance of contract and injunction ought to be dismissed and are accordingly rejected.
29.The plaintiff has however proved that the plaintiff paid a sum of Rs.1 Lac on 01.04.2006 and another sum of Rs.50, 000/ on 23.06.2006 vide Ex.PW1/3 & 4, respectively. The defendant has not controverted in her written statement that any such amount was not received by her. The defendant rather admits receiving of these amounts in the written statement. The defendant choose not to come and contest the suit or prove that she suffered any loss or damage because of any failure of performance of contract by the plaintiff.
30. In Veerayee Ammal v. Seeni Ammal [(2002) 1 SCC 134] it was observed :
"We, therefore, are of the opinion that interest of justice would be sub served if this Court refuses to exercise its discretionary jurisdiction in terms of Section 20 of the Act, directing the defendant to pay a sum of Rs. 60,000/ to the plaintiff which sum would include the amount of advance paid by her."
31. In Union of India v. Rampur Distillery and Chemical Co.
Ltd. AIR 1973 SC 1098, following the decision of, a three judge bench of Hon'ble SC, in Maula Bux v. Union of India Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 20 of 22 r 21 AIR 1970 SC 1955, it was held that, a party to a contract taxing security deposit from the other party to ensure due performance of the contract is not entitled to forfeit the deposit on ground of default when no loss is caused to him in consequence of such default. (Paras 4, 5)
32.In the present case also the defendant did not come and prove that he suffered any loss due to nonperformance of contract. Rather she sold the property to another. No loss was claimed in written statement. Thus the plaintiff ought to be returned the amount of Rs. 1.5 Lakhs paid by the plaintiff to the defendant. The defendant has already sold the suit property and thus the defendant must be asked to return the said amount of Rs.1, 50,000/ paid by the plaintiff to the defendant with bank interest.
33.In the present suit, though the plaintiff has not specifically prayed for return of Rs.1.5 Lakh but the last Para of the prayer clause reads that the court may pass such other orders as the court deems fit. In such circumstances, the return of the earnest money is treated as a prayer on behalf of the plaintiff in the last Para of the prayer clause and is accordingly allowed as follows.
34.The plaintiff is entitled to a decree of a sum of Rs. 1. 5 Lakhs Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 21 of 22 r 22 from the defendant. The plaintiff shall also be entitled to interest at the rate of 6% per annum on the amount of Rs.1 Lac from 01.04.2006 and from 23.06.2006 on the amount of Rs.50,000/ till filing of the suit. The plaintiff is also entitled to interest at the same rate on the amount of Rs. 1.5 Lakhs during pendency of the suit and at the same rate from the date of decree till realization, but subject to depositing of the appropriate court fee by the plaintiff for the said amount of Rs.1.5 Lakh.
35.The suit of the plaintiff is accordingly partly dismissed qua the prayer of specific performance of contract and qua perpetual injunction and is partly decreed for recovery of Rs. 1.5 Lakh with interest as mentioned above.
36.Decree sheet be prepared accordingly. File be consigned to the record room.
Announced in the open court on 13th day of August, 2012. DIG VINAY SINGH ADJ04 (CENTRAL) DELHI.
Judgment Suit no. 50/11/07 Rajender Singh Vs.Smt. Krishna Kumari dtd 13.08.2012 Page 22 of 22 r