Bangalore District Court
Sri.K.L.Srinivasa Murthy vs For The Relief Of Specific Performance ... on 7 June, 2018
IN THE COURT OF THE XI ADDL.CITY CIVIL JUDGE,
BANGALORE CITY (C.C.H.No.8)
Dated this the 7th day of June 2018
PRESENT: Sri.K.B.PATIL, B.Com.,LL.B.,(Spl)
XI Addl.City Civil Judge, B'lore city.
O.S.No.3352 of 1993
PLAINTIFFS: Sri.K.L.Srinivasa Murthy,
aged about 61 years,
S/o Sri. K.S.Laxminarayana Setty,
R/at Flat No.402,
Sree Poorna Prajana Apartments,
No.347/2, Gangadhar Layout,
Vijayanagar,
Bangalore-40
(By Sri.B.M.J.advocate
: Vs :
1. Sri. T.R.Sampath Kumar,
Major,
S/o Late Sri. Rajagopal Chettiar,
R/at No.97,
Dispensary Road,
Civil Station, Bangalore
Since dead by his Lrs.
D.1(a) S.Devaraj, major,
S/o Late Sri. T.R.Sampath Kumar
R/at No.92, Dispensary Road,
Civil Station,
Bangalore
2 OS.No.3352 of 1993
D.1(b) S.Gopimurali,
major,
S/o Late Sri. T.R.Sampath Kumar
R/at No.92, Dispensary Road,
Civil Station,
Bangalore
D.1© Smt. Srilakshmi,
aged about 38 years,
D/O Late Sri.T.R.Sampath Kumar,
D.1(d) Smt. Geetha S.Babu,
aged about 36 years,
D/O Late Sri.T.R.Sampath Kumar,
D.1(e) Smt. Anuradha,
aged about 31 years,
D/O Late Sri.T.R.Sampath Kumar,
D.1(f) Smt. Ranganayaki,
aged about 32 years,
D/O Late Sri.T.R.Sampath Kumar,
D.1(g) Smt.Mohana Kumari,
aged about 26 years,
D/O Late Sri.T.R.Sampath Kumar,
All are R/atNo.97, Dispensary Road,
Civil Station, Bengaluru.
2. T.R.Uthamanamb,
major,
s/o late Sri. Rajagopal Chettiar,
R/at No.97, Dispensary road,
Civil Station,
Bengaluru
(Sri.S.S advocate for D.1(a) (c) to (g)
3 OS.No.3352 of 1993
Sri. G.S.P.K. advocate for D.1(b)
Sri.S.K. advocate for D.2)
Date of the institution of suit: 31.5.1993
Nature of the suit: Specific performance
Date of the commencement of 2.3.2011
recording of evidence:
Date on which the judgment was 7.06.2018
pronounced:
Total duration Year/s Month/s Day/s
25 00 06
XI Addl.City Civil Judge,
B'lore city.
JUDGMENT
The present suit is filed by the plaintiff against the defendants for the relief of specific performance against the defendant seeking the direction to the defendants to perform their part of contract dated 3.1.1990 by executing deed of sale in respect of the suit schedule property in favour of the plaintiff and to deliver the vacant possession of the suit schedule property and to do all such acts and deeds necessary for and expedient in this regard.
4 OS.No.3352 of 1993If the defendants were fail to receive the balance sale consideration and to execute the sale deed, then this court to perform the said contract through the process of law and deliver vacant possession to the plaintiff by appointing Court commissioner for said purpose at the cost of the plaintiff for the said transaction and other reliefs.
2. It is the case of the plaintiff that the defendants are the absolute owners and in possession of the property being 3 acres of converted land on the southern side of Survey No. 92 of Singanesandra village, Bengaluru South Taluk morefully described in the plaint schedule In fact, the defendants are the absolute owners to the extent of 6 acres of the suit schedule land. The defendants being the owners of the suit schedule property , for their legal necessity offered to sell the suit schedule property. The plaintiff being in need of the same, agreed to purchase the suit schedule property. The defendants offered to the suit schedule property for a valuable consideration of Rs.18,90,000/- and the plaintiff accepted the said offer and after negotiation and that the sale shall be free from all encumbrances etc., Thereafter, the plaintiff and the defendants entered into an agreement of sale, under which, the defendants agreed to sell the suit schedule property for Rs.18,90,000/-. On the date of agreement i.e., on 3.1.1990, the plaintiff paid an advance amount of Rs.5,00,000/- to the defendants, which they acknowledged 5 OS.No.3352 of 1993 in the said agreement itself. In the said agreement vide Clause No.5, it was agreed that the vendors shall convey valid and subsisting title to the suit schedule property free from all encumbrances to the plaintiff. The time for the completion of the sale transaction was fixed at 4 months from the date of the said agreement. It was further agreed that the defendants shall deliver the vacant possession of the suit schedule property to the plaintiff or his nominees on the date of registration of the sale deed. The plaintiff has produced the copy of the said agreement.
However, time was not the essence of the contract. As per Clause No.6(a) of the suit agreement, the
defendants/vendors permitted the plaintiff to form sites in the suit schedule property. The defendants also further agreed that they will execute the sale deed either in the name of plaintiff or to his nominees. They further agreed to co-operate with the plaintiff in getting the necessary permission from the competent authorities and also agreed to furnish the documents and other deeds pertaining to the suit schedule property. But however, unfortunately, after the agreement was executed, the defendants are avoiding to co-operative with the plaintiff in getting the necessary permission from the competent authority for the sale transaction. The defendants are not furnishing the title deeds and other document pertaining to the suit schedule property and are not ready to furnish to co- operate with the plaintiff for getting the necessary 6 OS.No.3352 of 1993 sanction for the transaction. The plaintiff has approached the defendant several times, requesting them to furnish documents and information for obtaining the permission from competent authority for sale transaction. The defendants are one or the other pretext, postponing the said issue and are avoiding the plaintiff. The plaintiff also written several letters requesting the defendants regarding the same. The plaintiff reliably learnt that since the prices have gone up, the defendants are not willing to sell the suit schedule property to the plaintiff for agreed sale consideration. Plaintiff is ready and willing to perform his part of the contract. It is further submitted that he along with his nominees are ready with performance of the part of the contract by not co-operating with the plaintiff and have failed to furnish the documents and information necessary for getting the permission. It is further submitted that the said transaction could not be concluded only on account of tactics adopted by the defendants. The plaintiff in the above circumstances, having left with no other remedy caused legal notice to both the defendants dated 26.4.1993, which was received by both the defendants. To the said notice, the defendants have admitted the agreement and have agreed to execute the sale deed on payment of balance amount. However, the defendants have cleverly put the blame on the plaintiff for not getting the permission early and in the reply notice, they have not said anything about their co-operation in 7 OS.No.3352 of 1993 getting the permission for the sale transaction. In the said reply notice, they have stipulated the period of 8 days in getting the registration of the sale deed and payment of balance amount, knowing fully well that permission is not yet obtained. They have also indicated that if the same is not complied within the period, the agreement will stand cancelled. The said reply is only eye wash and is not with any intent to comply with the terms of the contract. The said reply notice was properly relied by the plaintiff, showing the readiness and willingness to perform his terms of contract and requested the defendants to co- operate in getting the permission for the transaction. To the said rejoinder, the defendants have neither replied nor have come-forward with specific proposal for the sale transaction. From the above conduct of the defendants, it is crystal clear that they have no interest in the sale transaction, since the prices have escalated and getting offer and as such they are totally avoiding with the present transaction. As per Clause No.6(e), the defendants have no power to rescind the agreement unilaterally. Hence, the agreement is still in force and can be enforced. The defendants assured that they will get the necessary permission and also co-operation with the plaintiff in getting the same for the sale transaction. Each time, the defendants, when the plaintiff made persistence, assured that they will do the same and inform the plaintiff, but however, they never complied with the same. It is also 8 OS.No.3352 of 1993 the duty of the defendants to get the permission for the transaction. The defendants showing fully well have not at all taken any action not intimated the plaintiff. The defendants are avoiding the transaction in view of the escalation of the price. Throughout the said period, the plaintiff has been ready and willing to perform his part of contract, but for the clever method of the defendants in only assuring and avoiding the request of the plaintiff on several occasion from time to time, the sale transaction would have been completed. Plaintiff has reliably learnt that the defendants is secretary arranging to alienate the suit schedule property in favour of third parties, suppressing the fact of existing agreement, which may give raise to multiplicity of litigations and hardship. In order to deprive the plaintiff, the defendants are creating mortgage on the schedule property. Hence, the present suit. The cause of action for the suit arose on 3.1.1990 and on 3.5.1990 and from time to time and thereafter during the period of limitation , well within the jurisdiction of this Court. Hence, prayed for decree the suit.
3. In response to the summons issued in this case, defendants appeared through counsel. During the course of trial, the defendant No.1 died and his L.Rs were brought on record. In the last amended written statement of defendants, they have contended that the defendants denied all the allegations in the plaint other than those that 9 OS.No.3352 of 1993 are expressly admitted. The defendants deny the allegations in para No.3 and 4 of the plaint and put the plaintiff to strict proof. The defendants denied the allegations in para No.5 of the plaint and put the plaintiff to strict proof. The defendants denied the allegations in para No.6 of the plaint and put to the plaintiff to strict proof. It is absolutely false that the defendants have not co- operated with the plaintiff in getting necessary permission from the competent authority for the sale transaction. It is in fact, the defendants from the date of agreement, till they received the notice from the plaintiff was requesting the plaintiff to take necessary steps to get permission as per the terms of the agreement and inspite repeaded demands and requests as the plaintiff was not at all responded and he was not having funds. The plaintiff did not take any steps to move the concerned authorities for getting permission to get the documents registered. In fact these defendants were ready on the date of agreement itself to execute the sale deed and even subsequently they were ready and inspite of their readiness and willingness to perform their part of contract. The plaintiff has no funds with him, he did not take any steps to get the permission from the concerned authorities and he pleaded his inability to purchase the property as he had no money with him. The plaintiff who has been postponing the dates to complete the sale transaction since the beginning and within the period of time of 4 months, the plaintiff has not completed the transaction inspite of giving 10 OS.No.3352 of 1993 several opportunities , the plaintiff did not perform his part of contract. It is absolutely false that since the prices have gone up, the defendants are not willing to sell the suit schedule property to the plaintiff as alleged. The defendants in fact who have replied the notice on 28.4.1993, which was issued on behalf of the plaintiff gave a sportive offer to the plaintiff to perform his part of contract within 8 days from the date of receipt of the reply notice and he has committed the breach of contract. As the plaintiff has not performed his part of contract even though opportunity was given to him and inspite of repeated demands and requests by the defendants by virtue of their notice dated 29.4.1993 have cancelled the agreement and as such the plaintiff cannot file the present suit for specific performance of the agreement. The defendants denied the allegations that several letters have been written by the plaintiff to these defendants as alleged. It is the defendants, who have approached the plaintiff and requested him to perform his part of the contract from the beginning. The allegations in para No.7 of the plaint are false. It is absolutely false that the plaintiff was ready and willing to perform his part of contract as alleged. It is the plaintiff who has committed breach of contract and at no time, he was ready and willing to perform his part of the contract. Even though the agreement is dated 3.1.1990 even in the month of April 1993, the defendants gave an opportunity for the plaintiff to perform his part of contract by paying the amount. As the 11 OS.No.3352 of 1993 plaintiff was not having funds for the purpose of completing the contract, he has not taken the sale deed executed and he has committed breach of the agreement. Even subsequent to the receipt of the notice, the defendants approached the plaintiff and requested him to perform his part of the contract and as the plaintiff has no money with him, he did not perform his part of contract. The agreement has been cancelled and the plaintiff cannot have any grievance for him and it is false to state that the defendants have no power to rescind the agreement unilaterally. At no point, the plaintiff was ready and willing to perform his part of contract and inspite of giving several opportunities and inspite of giving an opportunity to the plaintiff in the year 1993 to perform his part of contract, he has purposely come-forward with the present suit. At no time, the defendants failed to complete the transaction as alleged. It is not the plaintiff who has approached the defendants, but it is the defendants who have approached the plaintiff for more than 20 times and as the plaintiff had no money with him, he did not perform the contract. The plaintiff has not placed any material to show that he was ready and willing to perform his part of contract and he has not placed any material to show that he had sufficient and requisite funds for the purpose of completing the transaction except saying that he was ready and willing to perform his contract. The plaintiff even today has not deposited the amount and even on the date of filing of the suit, he was not ready and willing to perform his part of 12 OS.No.3352 of 1993 contract. It is absolutely false that the defendants are trying to alienate the property as alleged and the plaintiff has approached this Court with ulterior motives. There is no cause of action for the suit and the plaintiff has come- forward with false and frivolous suit. Suit is barred by limitation. Plaintiff has not at all deposited the amount and as such without depositing the amount, he cannot file the suit and as such the suit is not maintainable. The defendants further contended that the land in question was converted for an industrial purpose and in the conversion certificate, the conditions are incorporated and the land should be used only for industrial purpose and they will not be able to deviate. If the land is not used for the purpose for which the conversion was granted the conversion stands revoked. In view of these conditions as the land is granted only for the industrial purpose, the alleged agreement is for the purpose of constructing residential premises and forming sites for the residential premises is void and it is against the conversion certificate. Hence, under no circumstances, such a contract is enforceable under the law. In fact, the plaintiff after going through the conversion certificate was fully aware that such a contract cannot be entered into. Hence, the contract is hit under Sec.23 of Indian Contract Act and such a contract cannot be enforced. As such on that score itself, the suit for specific performance of the contract should be dismissed. Defendants further contended that as can be seen from the 13 OS.No.3352 of 1993 contract that the property is not demarcated and admittedly, the land is measuring 6 acres and 1 guntas and the land to be sold in only 3 acres and it is stated only a southern portion. But unless and until the property has been measured and demarcated, it cannot be said, where the southern portion ends and which is the point of division. Hence, the property cannot be identified, the specific performance of such a contract cannot be granted at all. The agreement was entered into between the parties on 3.1.1990. Under the amended Income Tax Act, within 15 days of the agreement, an application should be filed with the competent authority for No Objection under Rule 37(1). Admittedly, such an application was not filed. Under the agreement, it is the duty of the plaintiff to take all the clearance at his cost. Once the plaintiff has not done it under the law, the property cannot be sold at all as No Objection was not obtained from the Income-Tax Authorities as the sale price is exceeding Rs.10,00,000/-. Hence, the contract has become infractuous and cannot be enforced under the law. Clause No.4 of the agreement, it is crystal clear that the plaintiff should take all the necessary clearance at his cost. The plaintiff did not do any act to show that he is ready and willing to perform his part of the contract. He neither filed for clearance nor obtained No Objection Certificate from Income-Tax Department He did not file any application to get the clearance from the Income Tax Department under Sec.230(A) of the Act and 14 OS.No.3352 of 1993 he has not filed any application before the Urban Land Ceiling Authority to exempt the excess of the land remained for the alienation. Now it is well settled law even the Urban Land Ceiling Authority also under Sec.20 of the Act cannot grant permission to alienate excess of land. Hence, plaintiff did not perform his part of contract. Even otherwise, under law also, the defendants cannot alienate the property without the permission under the Urban Land Ceiling and Regulation Act and it cannot be granted now. Hence, the contract has become unenforceable and no decree for specific performance cannot be granted as the contract itself is against the statute. The plaintiff contended in the plaint that he was authorized to form sites as per Clause No.6(a). No doubt such a clause is introduced , but Clause No.3 is very clear, the possession will be give only at the time of registration of the sale deed. When such is the case, no possession is given to the plaintiff and the plaintiff has not formed any layout or made sites and the question of selling the sites to anybody would not arise without the clearance from the Urban Land Ceiling Authorities. The land was converted only for industrial purpose. Hence, unless and until the change of land use is obtained from the competent authority, the question of forming layout and the question of making sites or the question of selling the sites to nominees of the plaintiff would not arise at all. Hence, when the agreement is vitiated under law and the plaintiff cannot seek for any specific performance or such contract. Even as per 15 OS.No.3352 of 1993 the terms of agreement itself, remedy is given to the plaintiff. The decree for specific performance is discretionary. Once there is an alternative remedy available, the Court may not grant a decree for specific performance. Plaintiff did not perform his part of the contract in any manner whatsoever. Hence, the option is to be defendants to rescind the contract or continue the contract. In the reply notice itself, the defendants have rescinded the contract and forfeited the earnest money paid by the plaintiff. Hence, no contract is in existence at the time of filing the suit and the question of specific performance of contract would not arise at all. It is not the case of the plaintiff at any time the plaintiff approached the defendants for subscribing their signatures to get clearance from various authorities and the defendants refused to subscribe their signatures. When such is the case, the defendants have specifically stated that they themselves approached the plaintiff to get through the contract and requested the plaintiff to bring the necessary clearance. The plaintiff did not do it because he had no money to pay the balance sale price and ultimately, the defendants rescinded the contract. Now the plaintiff cannot contend before the Court that he was ready and willing to perform his part of contract and the defendants did not co- cooperate. Hence, the plaintiff failed to perform his part of contract and he cannot ask for specific performance of the contract and the suit is liable to be dismissed in limine and as the amount is also forfeited, plaintiff is not entitled to 16 OS.No.3352 of 1993 claim back the amount. Hence, defendants prayed for dismiss the suit.
4. On the basis of the above facts, the following issues additional issues having been framed:-
1. Whether the plaintiff proves that he has been ever ready and willing to perform his part of contract?
2. Whether the plaintiff proves that he is entitled for the specific performance of the agreement of sale?
3. Whether the plaintiff proves that he is entitled for vacant possession of the suit property?
4. Whether the defendants prove that the suit is barred by limitation?
5. What decree or order?
ADDITIONAL ISSUES
1. Whether the contract dated 3.1.1990 is hit by the provisions of Section.8 of the Indian Contract Act?
2. Whether the defendants prove that the contract has become infructuous and unenforceable for the reasons stated in paras 8 and 10 of the written statement?
3. Whether the defendants prove that they have rescinded the contract and forfeited the earnest money for the reasons stated in para No.23 of the written statement?
17 OS.No.3352 of 19935. In order to prove the case of plaintiff's case, the plaintiff himself examined as P.W.1 and got marked Ex.P.1 to P.40. On behalf of defendants, 2nd defendant himself is examined as D.W.1 and got marked Ex.D.1 and Ex.D.2.
6. Heard arguments.
7. My answers to the above issues are as follows:-
Issue No.1:` In the affirmative
Issue No.2: In the affirmative
Issue No.3: In the affirmative;
Issue No.4: In the negative;
Additional In the negative;
Issue No.1:
Additional In the negative;
Issue No.2:
Additional In the negative;
Issue No.3:
Issue No.5: As per final order for the following
reasons:
REASONS
8. Issue No.4 and Additional Issue No.1 and 2: All
these issues are interrelated to each answer. Hence, I answer all these issues together to avoid repetition of facts.
18 OS.No.3352 of 19939. The present suit is filed by the plaintiff for the relief of specific performance on the basis of the agreement of sale as per Ex.P.39. In the present case, execution of Ex.P.39 is admitted fact. All the terms and conditions of Ex.P.39 are also admitted by both the parties. Passing of consideration under Ex.P.39 is also admitted. Under these circumstances, this Court is of the opinion that before answering the issues on merits of the case, the question of law raised by the defendants in their written statement has to be answered first and then go to the merits of the case with respect to suit transaction.
10. Defendants in their written statement have contended that suit of the plaintiff is time barred. The present suit is filed by the plaintiff on the basis of the agreement of sale as per Ex.P.39 dated 3.1.1990. The period fixed to conclude the suit transaction as per Ex.P.39 is 4 months as per Clause No.9 of Ex.P.39. The present suit is filed on 31.5.1993. As per Article.54 of Limitation Act, in case of suit for specific performance of contract, the period of limitation is 3 years. The said three years begins to run in case the date fixed for performance or, if no such date is fixed, when the plaintiff has notice that performance is refused. Under these circumstances, the time starts from the completion of 4 months from the date of completion of 4 years from the date of Ex.P.39. This Court is of the opinion that the suit is in time. In view of the facts and 19 OS.No.3352 of 1993 circumstances of the present case, it is clear that the time is not the essence of the contract in the present case. The plaintiff was supposed to pay the balance sale consideration only at the time of execution of sale deed in pursuance of Ex.P.39 in his favour, plaintiff and defendants have to perform reciprocal promise to conclude the suit transaction. The plaintiff also by issuing notice as per Ex.P.35 has given up all the contentions with respect to the time limitation to conclude the suit transaction. Under these circumstances, the arguments on behalf of the defendants that the suit is time barred cannot be accepted.
11. The decision relied on by the defendants in this regard will be considered and discussed at the time of answering Issue No.1.
12. The defendants further in their written statement have contended that the agreement dated 3.1.1990 is hit by the provisions of Sec.8 of Indian Contract Act. Sec.8 of Indian Contract Act refers to as " Acceptance by performing conditions, or receiving consideration.- Performance of the conditions of a proposal, or the acceptance of any consideration for a reciprocal promise which may be offered with a proposal, is an acceptance of the proposal." As per Ex.P.39 in order to complete the suit transaction, several terms of agreement have been impleaded. According to which, the defendants have received Rs.5,00,000/- by way 20 OS.No.3352 of 1993 of advance amount on the date of Ex.P.39 through cheque and balance sale consideration shall be payable purchaser or hi nominee or nominees to the vendors as and when the sale deeds are executed by the vendors either to the purchasers, his nominees either in one sale deed or in different plots. The vendor shall put the transferees in vacant possession of the plots which will be mentioned in the proposed sale deeds on the registration of the respective sale deeds. The purchaser or his nominee or nominees shall meet all the expenses at their cost such as stamp duty, registration and drafting charges and for obtaining permission from its competent authority. The vendors shall convey valid and subsisting title free from all kinds of encumbrances, attachments, minor or partition rights, litigations and acquisition/requisition proceedings. Further the purchaser is entitled to form the sites in the schedule property and secure the required permission and clearance from the competent authority at his cost. However, the vendors shall assist the purchaser in given petitions, no objection letters or any other documents are necessary in secure such licences and permissions. Further the vendors have no objections to execute the sale deed/s either in favour of the purchaser or his nominee or nominees in respect of the sites that may be formed in the schedule property either in one sale deed or sale deeds. The schedule lands are not subject to any acquisition or requisition proceedings and as on the day, no statutory 21 OS.No.3352 of 1993 authorities have issued any notification. The vendors have not entered into any agreement or transactions in respect of the schedule land except under this agreement and the vendors will not unilaterally revoke or rescind this contract as per Ex.P.39. In case purchaser failed to get the sale deed executed either in his favour or his nominee or nominees within the period of four months from this date, then the vendors shall forfeit the advance amount this day paid by the purchaser. In case, the vendor fail to execute sale deed, either in favour of the purchaser or his nominee or nominees then the purchaser may at his option either sue for specific performance or in the alternative claim the refund of Rs.5,00,000/- and the liquidated damages of a like sum of Rs.5,00,000/- that is in all Rs.10,00,000/-. The vendor and the purchaser shall provide an approach road to the schedule property running west to east to a length of 30 feet and having a width of 19 feet from each of the party from the eastern end of the existing road of 16 feet width to a length of 300 ft., running from Hosur road. From these terms, there is a reciprocal promise has to be performed by the vendor and the purchaser under Ex.P.39. The schedule property described as 3 acres of converted land on the southern side of Survey No.92 of Singasandra village, Bengaluru South Taluk, Begur Hobli, Bengaluru District and bounded on East by Kudle Yelle, West by Lands belongs to Ammayamma @ Muniamma, North by remaining lands of Survey No.92, Singasandra belongs to the vendors and 22 OS.No.3352 of 1993 south by lands belonging to Nadupanna and Agamarappa together with the common approach road leading from Hosur road and running west to east and measuring north to south 16 feet and west to east 300 feet up to the western boundary of the schedule property belonging to the vendors. From this description, it is clear that the total extent of Survey No.92 is 6 acres 1 guntas and out of it, southern 3 acres of land was agreed to be sold under Ex.P.39. The defendants in their written statement at para No.17 have contended that as can be seen from the contract, that the property is not demarcated and admittedly, the land is measuring 6 acres and 1 guntas and the land proposed to be sold in only 3 acres and it is stated only as southern portion. But unless and until the property has been measured and demarcated, it cannot be said, where the southern portion ends and which is the point of division. Hence, the property cannot be identified the specific performance of such contract cannot be granted at all. From taking this contention by the defendants in their written statement, it is clear that from the date of Ex.P.39 till filing of the written statement, the defendants have not demarcated the property agreed to be sold in favour of the plaintiff i.e., 3 acres of southern portion of Survey No.92. Unless the properties are demarcated, it is not possible for the plaintiff to form any layout or sites in the suit schedule property as agreed by both the parties under Ex.P.39. There is no explanation by the defendants for not demarcated the property agreed to be 23 OS.No.3352 of 1993 sold in favour of the plaintiff till filing of the written statement in the present suit. The duty of the vendor i.e., the defendants is to demarcate and identify the property agreed to be sold to the plaintiff under Ex.P.39 and by not performing their part of contract, the defendants cannot take defense on the ground that as the property is not demarcated and hence, the specific performance of such contract cannot be granted. The defendants cannot be allowed to take the benefit of mistake committed by him. Further in para No.18 of written statement, defendants have contended that the agreement was entered into between the parties on 3.1.1990. Under the amended Income Tax Act within 15 days of the agreement, an application should be filed with the competent authority for No Objection under Rule 37(1). Admittedly, such an application was not filed. Under the agreement , it is the duty of the plaintiff to take all the clearances at his cost. Once the plaintiff has not done it under the law, the property cannot be sold at all as No Objection was not obtained from the Income Tax Authorities as the sale price is exceeding Rs.10,00,000/-. Hence, the contract has become infractuous and cannot be enforced under law. On this ground the defendants seeking dismissal of the suit on the ground that the contract become infructuous and unenforceable. This contention of the defendants cannot be accepted in view of the fact that it is true as per Ex.P.39, the purchaser is entitled to form sites in the schedule property and secure the required permission 24 OS.No.3352 of 1993 and clearance from the competent authority at his cost. However, the vendor shall assist the purchaser in giving petitions, no objection letter or any other document that are necessary in secure such licences and permissions. In the entire written statement, the defendants have not contended that they have assisted the plaintiff in obtaining such clearance from the competent authority. In this regard, it is to be noted that plaintiff on 23.7.1990 has issued notice to the defendants as per Ex.P.10 informing that "in view of the discussed last week regarding registration of sites formed in Survey No.92, 3 acres of land out of 6 acres 1 gunta. The defendants have informed the plaintiff that they have to obtain necessary permission for registration purpose. Mean while, the purchasers are requesting them to perform the registration. However, he convinced them regarding the delay in obtaining the permission for registration. Hence, requested the defendants to furnish the documents to obtain necessary permission i.e., list of borrowers and evidence, profit and loss accounts certified copy and other outstanding list. So that he will give full co-operation to obtain the necessary permission to discharge the sale transaction at the earliest". This notice is served upon the defendants, but the defendants neither replied nor complied to the said notice. Under these circumstances, the defendants cannot contend that inspite of his assistance, the plaintiff has not able to secure the required permission to conclude the suit transaction as per Clause No.6(a) of 25 OS.No.3352 of 1993 Ex.P.39 that the vendor shall assist the purchaser in giving petitions, no objections letters or any other documents that are necessary in secure such licence or permission to conclude the suit transaction. Under these circumstances, the contention of the defendants that the contract has become infructous and unenforceable as contending in the written statement cannot be accepted. Under Ex.P.39 both vendors and purchasers have to perform reciprocal promise to conclude the suit transaction. The property agreed to be sold under Ex.P.39 is southern portion of 3 acres of land out of Survey No.92 of Singasandra village. Defendants in their written statement contended that till filing of the written statement, the said 3 acres of land was not identified. That itself goes to show that unless the property is identified, which is agreed to be sold under Ex.P.39 , the other formalities cannot be completed. In the present case, the purchaser has to secure permission and clearance from the competent authorities to complete the suit transaction. However, at the same time, the vendor has to assist the purchaser to obtain the said permission and clearance from the competent authorities. In the present case, the defendants have not produced any evidence to show that from the date of Ex.P.39 till filing of the suit, they ever attempted to assist the purchaser to obtain permission and clearance from the competent authorities. As already stated above Ex.P.10 issued by the plaintiff to the defendants on 23.7.1990 itself 26 OS.No.3352 of 1993 calling upon the defendants to assist to obtain clearance from the competent authorities. But the defendants have not replied to the said notice nor complied with the said notice. Under these circumstances, it is clear that there is no evidence produced by the defendants to show that from the date of Ex.P.39, they ever attempted to assist the plaintiff to obtain the permission and clearance from the competent authorities required to conclude the sale transaction. The defendants further contended that in view of non obtaining clearance from the ULCR Act and Income Tax authorities, the contract become infructuous and cannot be accepted in view of the fact that the property agreed to be sold is not yet identified and also there is no evidence to show that the defendants have made an attempt to assist the plaintiff to obtain the required clearance and permission from the competent authorities including the Income tax and ULCR Act also. As on today the clearance from the Income Tax as required under Sec. 238 is not required and also since the ULCR Act is repealed long back during pendency of the present suit. The permission as required under ULCR Act is also not necessary. Considering over all evidence produced by the plaintiff and the defendants in the present case, it is clear that the plaintiff has made an attempt seeking assistance of the defendants to obtain required clearance and permission from the competent authorities to conclude the suit transaction. At the same time, the defendants have not produced any 27 OS.No.3352 of 1993 evidence to show that they have ever attempted to assist the plaintiff to obtain such clearance and permission from the competent authorities. The defendants neither replied nor complied to the notice issued by the plaintiff as per Ex.P.10. Under these circumstances, the contention of the defendants that because on the part of the plaintiff, the suit transaction was not completed cannot be accepted. In view of the above discussions, this Court is of the opinion that defendants failed to prove Additional Issue No.1 and 2 and Issue No.4. Hence, I answer Issue No.4 and Additional Issue No.1 and 2 in negative.
13. Issue No.1 and 3: Both these issues are interlinked with each other. Hence, I answer both these issues together to avoid repetition of facts.
14. The plaintiff in his plaint contended that from the date of Ex.P.39, plaintiff was and is ever ready and willing to perform his part of contract. The defendants contended that the plaintiff was never ready and willing to perform his part of contract from the date of Ex.P.39, he was not having sufficient funds to pay balance sale consideration amount as agreed under Ex.P.39. Plaintiff has not produced any evidence to show that he was having balance sale consideration amount with him from the date of Ex.P.39 till filing of the present suit. Further the advocate for defendants argued that as contemplated under Sec.16(c)of 28 OS.No.3352 of 1993 S.R.Act , the plaintiff must ever and prove that he was having sufficient funds to conclude the suit transaction and he was ready and willing to perform his part of contract under suit agreement. But the plaintiff has not produced any evidence in that regard, he is not entitled for the relief of specific performance. On this ground, the defendants contended that the plaintiff failed to prove that he was and is ready and willing to perform his part of contract. As per Ex.P.39, the total consideration agreed is Rs.18,90,000/-. On the date of Ex.P.39, plaintiff has paid Rs.5,00,000/- to the defendants as advance amount. All these facts are admitted facts in the present suit. The balance sale consideration is Rs.13,90,000/- . On this ground the advocate for defendants argued that in the present suit, plaintiff has not produced any evidence to show that since from the date of Ex.P.39, plaintiff has not produced any evidence to show that since from the date of Ex.P.39, plaintiff has not produced any evidence to show that he was having sufficient funds to pay Rs.13,90,000/- was in his possession. In this regard, plaintiff has contended that he was having sufficient funds to pay the balance sale consideration, he has produced passbook as per Ex.P.1. On perusal of Ex.P.1, it is clear that there was no sufficient funds in the account of the plaintiff to pay the balance sale consideration. However, advocate for plaintiff argued that he was not supposed to pay the balance sale consideration of Rs.13,90,000/- before the execution of sale deed, the 29 OS.No.3352 of 1993 balance sale consideration has to be paid at the time of execution of sale deed. There is no recital in Ex.P.39 that the balance sale consideration has to be paid within a stipulated period. The condition of 4 months is included in Ex.P.39 only to conclude the suit transaction, but not for payment of balance sale consideration amount. Apart from this, the advocate for plaintiff contended that as per Clause No.2 of Ex.P.39, the balance sale consideration shall be payable by the purchaser or his nominee or nominees to the vendors as and when the sale deeds are executed by the vendors either to the purchaser or his nominees either in one sale deed or in different sale deeds. As per Ex.P.39, the plaintiff was permitted to form layout and also permitted to sell the sites. In view of Clause No.2 of Ex.P.39, the balance sale consideration shall be payable by the plaintiff only at the time of selling the sites, which proposed to be formed in the suit schedule property by the plaintiff after obtaining necessary permission from the competent authorities. Under these circumstances, the defendants cannot say that balance sale consideration should have been paid within 4 months from the date of Ex.P.39 cannot be accepted. In view of the clear recital in Ex.P.39 as per Clause No.2 , the balance sale consideration shall be payable by the purchaser at the time of execution of sale deed of the sites, which are going to be formed by the plaintiff in the suit schedule property. Under these circumstances, the contention of the defendants that the 30 OS.No.3352 of 1993 plaintiff was not having sufficient funds to pay the balance sale consideration and hence, he is not entitled for the relief of specific performance of contract as per Ex.P.39 in view of Sec.16 of S.R.Act cannot be accepted. In support of his contention, the defendants relied upon the following decisions on the point of Sec.16(c) of S.R.Act:-
1. ILR 2016 Kar 2252 Para No. 34 - 38;2.ILR 2014 Kar 233, Para No.51- 58
3.(1995) 5 SCC 115 Para No.5-7 4.(2002) 9 SCC 582 Para No.6 & 7 5. (1996) 4 SCC 526 Para No.1 and 2
6.(2013) 15 SCC 27 Para 37, 38,4, 2 and 43
15. I have gone through all these decisions. In view of the discussions made above, Sec.16© of S.R.Act on the ground that the plaintiff was not having sufficient funds to pay the balance sale consideration cannot be accepted in view of the clear recital of Clause No.2 of Ex.P.39 to the effect that the balance sale consideration has to be paid by the purchaser at the time of execution of sale deed with respect to the sites to be formed by the plaintiff in the suit schedule property.
16. Further relying on Sec. 20 of S.R.Act, the advocate for defendants argued that when there is a sufficient equitable alternative relief, is entitled for the plaintiff for 31 OS.No.3352 of 1993 the relief of specific performance cannot be granted. In this regard, he relied upon a decision reported in (2011) 12 SCC 658, wherein it is held that it is well settled that the value of property escalates in urban areas very fast and it would not be equitable to grant specific performance after lapse of long period of time.
17. Further he relied on a decision reported in (1997) 3 SCC 1, wherein it is held that the court should look into time limit specified in the agreement of sale. Raise in prices is a relevant factor of consideration while exercising the discretion.
18. He further relied on a decision reported in (2008) 12 SCC 145, wherein it is held that no specific performance of contract can be granted, if it would give an unfair advantage to the plaintiff and where the performance of contract would involve hardship to the defendant which he did not foresee.
19. With due respect to the above decisions, this court is of the opinion that the principle laid down in the above decisions cannot be made applicable to the present case. In view of the fact that the suit is filed by the plaintiff within a period of limitation. By issuing notice by the defendants, as per Ex.P.35 dated 29.4.1993, defendants have agreed to 32 OS.No.3352 of 1993 execute sale deed admitting all the contents of Ex.P.39, but only contended that within 8 days from the date of Ex.P.35, the suit transaction should be concluded and on failure, the agreement dated 3.1.1990 will be cancelled and the defendants will forfeit the advance amount as per clause of the agreement. From this contention, it is clear that as on 29.4.1993 also, the defendants were ready and willing to perform their part of contract. But it is highly impossible for the plaintiff to obtain the required permission and clearance from the competent authorities within 8 days as the stipulated under Ex.P.35. The said notice was properly replied by the plaintiff by issuing reply notice as per Ex.P.38, wherein the plaintiff called upon the defendants within 15 days from the date of Ex.P.38, the defendants should cooperate with the plaintiff in getting permission from the competent authorities to conclude the suit transaction. The defendants have not produced any evidence to show that after receipt of Ex.P.38, the defendants have complied with the said notice. Even there is no pleadings in that regard. There is no denial that Ex.P.38 was not received by the defendants. The defendants neither replied to the notice as per Ex.P.38 nor complied with the same. Under these circumstances, the defendants cannot contend that they are entitled for the shelter under Sec.20 of S.R.Act. It is true that the value of the property was escalated from the date of Ex.P.39. Only on that ground, the defendants cannot claim that they will be put to irreparable loss, if the suit is 33 OS.No.3352 of 1993 decreed. In view of the non performance of terms of agreement by the defendants till filing of the suit, they cannot claim shelter under Sec.20 of S.R.Act. the defendants have clearly admitted in their written statement and D.W.1 in his cross-examination admitted that till filing of the written statement, the schedule property was not bifurcated from the total extent of land to identify the same. Under these circumstances, there was no occasion for the plaintiff to obtain necessary permission and clearance from the competent authorities unless the assistance of the defendants as contemplated under recitals of Ex.P.39. The advocate for defendants further argued that the schedule property is alienated land for industrial purpose. The plaintiff has contended that he has formed residential layout in the suit schedule property, which is contrary to the conversion order and hence, the agreement as per Ex.P.39 is unexecutable. Further he argued that though the plaintiff contended that he has formed layout in the suit schedule property, he has not produced any evidence in that regard. He has also contended that P.W.1 in his cross- examination admitted that the plaintiff has not obtained approved layout plan with respect to the suit schedule property. Under these circumstances, the action of the plaintiff is against the terms of the contract and hence, he is not entitled for the relief of specific performance. This argument also cannot be accepted as only on the ground that P.W.1 has contended something more in his pleadings, 34 OS.No.3352 of 1993 it cannot be held that plaintiff is not entitle for specific performance of contract. Unless the property agreed to be sold under Ex.P.39 is demarcated, the plaintiff is not able to obtain the sanctioned plan from the competent authorities to form layout in the suit schedule property. As already discussed above, the defendants have not produced any evidence to show that they assisted the plaintiff to obtain the required sanction and permission from the competent authorities. The plaintiff has not obtained the required permission and sanctioned plan from the competent authorities to conclude the said transaction. Under these circumstances, the defendants cannot claim shelter under Sec.16(c) and 20 of S.R.Act in the present case.
20, Advocate for L.R of defendant No.1and defendant No. 2 argued that Ex.P.39 imposed obligation upon the plaintiff under Clause No.4 and 6(a) of agreement of sale that the plaintiff shall obtain all the necessary permissions from the respective authorities at his own cost. Plaintiff supposed to obtain the Income Tax clearance as contemplated under Sec.239 UC of Income Tax Act 1961, which reads as under:-
"(1) Notwithstanding anything contained in the Transfer of Property Act 1882(4 of 1882) or in any other law for the time being in force, no transfer of any immovable property of such value exceeding five lakh rupees as may be prescribed shall be effected except after an 35 OS.No.3352 of 1993 agreement for transfer is entered into between the person who intends transferring the immovable property (Herein after referred to as the transferor) and the person to whom it is proposed to be transferred ( Herein after referred to as the transferee) in accordance with the provisions of sub-Section.(2) at least three months before the intended date of transfer.
(2) The agreement referred to in sub-
section(1) shall be reduced to writing in the form of a statement by each of the parties to such transfer or by any of the parties to such transfer acting on behalf of himself and on behalf of the other parties.
(3) Every statement referred to in sub-
section(2) shall ,-
(i) be in the prescribed form;
(ii) set forth such particulars as may be prescribed; and
(iii) be verified in the prescribed manner and shall be furnished to the appropriate authority in such manner and within such time as may be prescribed, by each of the parties to such transaction or by any of the parties to such transaction acting on behalf of himself and on behalf of the other parties.'
21. Further he argued that plaintiff was under
obligation to obtain clearance from ULCR Act 1976 to exempt the excess of the land remained for the alienation. Further contended that plaintiff failed to obtain necessary permission from Income Tax Authority and ULCR authority, the contract is unenforceable.36 OS.No.3352 of 1993
22. This argument cannot be considered in view of the discussions made above. In view of the fact that there is a reciprocal promise to conclude that has to be performed by the plaintiff and defendants to conclude suit transaction as per Ex.P.39. Unless and until the properties agreed to be sold is bifurcated and identified and unless the defendants have assisted the plaintiff to obtain the clearance from the concerned authorities, it cannot be said that the plaintiff is at fault in performing his part of contract. As already stated above, in the written statement itself, the defendants have contended that as on the date of filing the written statement also, the defendants have not bifurcated 3 acres of land agreed to be sold under Ex.P.39. As far as readiness and willingness of plaintiff as contemplated under Sec.16(c) of S.R.Act 1963 is concerned as already discussed above, the plaintiff has paid Rs.5,00,000/- as advance under Ex.P.39 and balance consideration has to be paid only at the time of execution of sale deed by the defendants in respect of sites proposed to be formed in the suit schedule property. The other aspects are concerned to obtain permission from the concerned authorities etc., as already discussed above, there is no evidence to show that defendants have assisted the plaintiff in obtaining the said permissions from the competent authorities. Since the property agreed to be sold under Ex.P.39 itself is not identified, the permission from the competent authorities as contemplated under Ex.P.39 cannot be obtained by the plaintiff without the assistance of 37 OS.No.3352 of 1993 the defendants. As already discussed above, plaintiff has issued Ex.P.10 to the defendants seeking cooperation from the defendants in obtaining permission. However, there is no evidence to show that the defendants have complied with the said notice or replied to the said notice. Plaintiff by issuing Ex.P.10 has already expressed his willingness to perform his part of contract. Apart from this, the defendants have issued notice as per Ex.P.35 on 29.4.1993, wherein they have contended that even on the date of Ex.P.35, they were ready and willing to execute the sale deed in favour of plaintiff with respect to suit schedule property. But they have contended that the plaintiff shall pay the balance amount within 8 days from the date of the said notice. From the contents of Ex.P.35, it is clear that the defendants have given up the other contention taken in the present suit. However, from the facts and circumstances of the present case, it is clear that unless property agreed to be sold is demarcated and approved licence and permissions, sanctions from the competent authorities is obtained, this suit transaction cannot be concluded. It is also impossible to obtain all the permission and sanctions within 8 days as contended by the defendants under Ex.P.35. In Ex.P.35, the defendants have not at all stated that they are agreed to cooperate with the plaintiff in obtaining the requisite sanctions from the competent authorities to conclude sale transaction. The said notice is duly replied by the plaintiff as per Ex.P.38, wherein the plaintiff has called upon the 38 OS.No.3352 of 1993 defendants to assist and cooperate with the plaintiff in getting permission from the competent authorities and execute sale deed within 15 days from the date of said notice. The receipt of said notice is not denied by the defendants. The defendants neither complied with nor replied with the said notice. From this, it is clear that the plaintiff has averred and proved that he was and is ready and willing to perform his part of contract as per Ex.P.39 as on the date of filing the present suit and also during pendency of the present suit. Under these circumstances, the defendants cannot contend that plaintiff failed to prove that he has been ever ready and willing to perform his part of contract. Plaintiff has produced cogent evidence in support of his contention to show that he was and is ready and willing to perform his part of contract as contemplated under Ex.P.39 in the present suit.
23. In the present suit, plaintiff is also seeking possession of the suit schedule property. Though under Ex.P.39 on the date of the said document, the plaintiff was permitted to form layout in the suit schedule property and also it was referred that the possession of the suit schedule property was handed over to plaintiff, but from the contention taken by the defendants in the present suit and also the evidence produced by both the parties, it is clear that as on the date of filing the present suit also, the property agreed to be sold under Ex.P.39 is not identified nor the necessary sanction and permission from the 39 OS.No.3352 of 1993 competent authorities is obtained. As already discussed above, there is no fault on the part of plaintiff in performing his part of contract as per Ex.P.39 and in the absence of any evidence to show that the defendants have identified the property agreed to be sold and assisted and cooperated with the plaintiff in obtaining necessary sanction and permission from the competent authorities, it cannot be said that the possession of the suit schedule property was duly handed over to the plaintiff. Sec.269UC of Income Tax Act and ULCR Act 1976 have been repealed during pendency of the present suit. At this stage, the complying of the said provisions is not at all necessary. Since the plaintiff has proved his readiness and willingness to perform his part of contract and hence, he is entitled for the relief of specific performance of contract and consequently he is entitled for the due possession of the suit schedule property. The contention taken by the plaintiff in his plaint regarding formation of sites agreeing to sell the sites to prospective buyers of the sites and also admission in that regard by the PW.1 during cross-examination will not disentitle the plaintiff for the relief in the present suit. Plaintiff nowhere contended that he has formed sites in the suit schedule property with approved plan from the competent authorities. The evidence produced by the plaintiff in that regard will not come in the way of plaintiff's claim in the present suit. Further the arguments of the defendants counsel that the suit schedule property was converted into 40 OS.No.3352 of 1993 not for non agricultural land, only for industrial purpose, the plaintiff has contended that he has formed residential sites in the suit schedule property and hence, he contravened the terms of Ex.P.39 and hence, he is not entitled for the relief of specific performance cannot be accepted in view of the fact that it is a fate of the plaintiff, if he has not formed industrial sites and contravened any order, then the concerned competent authorities will take necessary action against the plaintiff in accordance with law. On this ground, the defendants cannot deny the execution of sale deed in pursuance of Ex.P.39. Under these circumstances, in view of the discussions made above, plaintiff has proved that he has been ever ready and willing to perform his part of contract and also he has proved that he is entitled for possession of the suit schedule property. Hence, I answer Issue No.1 and 3 affirmative.
24. Additional Issue No.3: In this regard, the defendants on the basis of Ex.P.35 contended that the defendants have issued notice as per Ex.P.35 agreeing to sell the suit schedule property in pursuance of Ex.P.39 and within the stipulated period i.e., 8 days as stated in Ex.P.35, the plaintiff has not come forward to execute the sale deed and to conclude the suit transaction and hence, the agreement dated 3.1.1990 i.e., Ex.P.39 is cancelled and the advance amount is forfeited and hence, the plaintiff is not entitled for the relief claimed in the present suit. However, from Ex.P.38, it is clear that the plaintiff has issued reply 41 OS.No.3352 of 1993 notice to Ex.P.35 asking the defendants to cooperate with the plaintiff in getting permission from the concerned authorities to conclude the suit transaction within 15 days from the date of notice. As already stated above, the defendants have not produced any evidence to show that they made an attempt to cooperate with the plaintiff in obtaining the permission and sanction from the competent authorities to conclude the suit transaction. Apart from this, as per Clause No.6(e) of Ex.P.39, the vendors have not entered into any agreement or transactions in respect of the schedule land except under this agreement and the vendors will not unilaterally revoke or rescind this contract. The defendants in the present suit by issuing notice as per Ex.P.35 without complying their part of contract under Ex.P.39 unilaterally cancelled the contract. Hence, the said cancellation is not in accordance with the terms of the contract as per Ex.P.39. The defendants have no right to revoke or rescind the contract as per Ex.P.39 unilaterally without performing their part of contract. It is true as per Clause No.9 of Ex.P.39, The suit transaction shall be finalized within a period of 4 months from the date of Ex.P.39. But in view of the discussions made above, it is clear that the property agreed to be sold under Ex.P.39 is not identified , bifurcated as admitted by defendants in the written statement and also in the absence of any evidence to show that the defendants have cooperated and assisted the plaintiff in obtaining requisite sanction and permission 42 OS.No.3352 of 1993 from the competent authorities, the said period of 4 months cannot be considered. It is general rule that generally in an agreement with respect to immovable property, time is not the essence of contract. Whether time is essence of contract or not has to be considered on the basis of facts and circumstances of the present case. In the present case, there is no such facts are there to consider that the time is the essence of contract. As per Clause No.2 of Ex.P.39 and Clause No.6(a), it is clear that the plaintiff is entitled to form sites in the schedule property, then the balance consideration shall be payable by the plaintiff or his nominees to the vendors as and when sale deeds have executed by vendors either to the purchaser, his nominees either in one sale deed or in different sale deeds and also as per Clause No.6, vendors shall personally invoking of Clause No.2 mentioned in the proposed sale deeds in registration of the respective sale deeds. From this, it is clear that the contract as per Ex.P.39 will continue till the layout is formed in the suit schedule property and the purchaser formed the layout and sell the sites to prospective buyers and collect the consideration amount from the prospective buyers and paid the same to the plaintiff towards balance sale consideration. Under these circumstances, the cancellation of agreement of sale by issuing notice is not in accordance with the terms of Ex.P.39. Hence, the said cancellation cannot be considered as the valid cancellation of agreement as per Ex.P.39. Under these circumstances, 43 OS.No.3352 of 1993 this Court is of the opinion that the defendants failed to prove that they have validly rescinded the contract and forfeited the earnest money as contended in para No.23 of the written statement. The said cancellation or rescinding the contract as per Ex.P.39 by issuing notice as per Ex.P.35 is against the terms of Ex.P.39 and also against the law. Hence, I answer Additional issue No.3 in negative.
25. Issue No.2 and 5: In view of the discussions made above, the plaintiff has proved Ex.P.39 and also proved that he is ever ready and willing to perform his part of contract and he is entitled for vacant possession of the suit schedule property. The plaintiff has also proved that he is entitled for possession of suit schedule property and agreed to be sold under Ex.P.39. Under these circumstances, the plaintiff is entitled for the relief of specific performance of contract as per Ex.P.39 as prayed for in the present suit.
26. Advocate for plaintiff relied on a decision reported in AIR 1994 Delhi 345 with respect to Sec.20 of S.R.Act, wherein it is held that "in a suit for specific performance, failure to obtain Income tax clearance cannot non-suit the plaintiff transferee, on the ground that the agreement to sell was not enforceable without Income-tax clearance, in view of Sec.269-UC of Income-Tax Act." The principle laid down in the above case is aptly applicable to the present case. He also relied on a decision reported in LAWS (DLH) 1995 5 44 OS.No.3352 of 1993 57, which is also with respect to maintainability of the suit without complying Sec.269-UC of Income-tax Act.
27. Whether as far as the time is the essence of contract or not, the advocate for plaintiff relied on a decision reported in 2017(4) AKR 717, wherein it is held that:-
"A" Sec.55 of S.R.Act and Sec.16 of S.R.Act - Agreement to sell. Time whether essence of contract. Vendor receiving balance sale consideration amount after expiry of last date for receipt of balance sale consideration. Not issuing any notice terminating agreement immediately after completion of stipulated period for payment for payment. By his conduct, vendor showing that there is nothing sacrosanct about last date of receipt of consideration. Apparently vendor impliedly extending period for making balance payments. Time cannot be said to be essence of contract."
"B" Sec.16(c) of S.R.Act- Specific performance of agreement to sell-Readiness and willingness, vendee paying two-third of agreed sale consideration-Vendor admitting receipt of Rs.6,00,000/- out of Rs.9,00,000/- in written statement. He examining one witness who has deposed that meeting was held in hotel for settling matter, his account showing that he had requisite funds to pay balance sale consideration. His capacity to pay balance sale consideration cannot be disputed by vendor. Vendee held to be ready and willing to perform his part of contract.
"C" Clause No.c of S.R.Act and Sec.19(2) and 20 of S.R.Act- Specific performance of agreement to sell. Vendee paying two third of agreed sale 45 OS.No.3352 of 1993 consideration. Property allegedly sold to subsequent purchaser by executing sale deed. Vendor not stating in his written statement as to price for which, he sold site. Subsequent purchaser's evidence is also silent on sale price paid. Subsequent purchaser not knowing about neighbours of suit site. Admitting that khata of suit site is not transferred to name of vendor. Plea of subsequent purchaser that they are bonafide purchasers for valuable consideration not tenable."
28. In the present case also within 4 months from the date of Ex.P.39 and also immediately thereafter the defendants have not issued any notice terminating the agreement and by this conduct, it cannot be said that the time is the essence of the contract. It is also pertinent to note that as already discussed above, balance sale consideration has to be paid by the purchaser only at the time of execution of sale deed by the vendor. Further he relied on a decision reported in ILR 2007 Kar. 4440, relevant part is para No.12. In the present case also, the obligation to be performed by the plaintiff under Ex.P.39 depends upon the performance of obligation imposes under Ex.P.39 on the defendants. As already stated above, there is no evidence produced by the defendants to show that the property agreed to be sold is identified and defendants have cooperated and assisted the plaintiff in obtaining required sanction and permission from the competent authorities. He further relied on a decision reported in (2012) 5 SCC 712. This is with respect to Sec.16(c) of S.R.Act - Readiness and willingness of plaintiff to perform his part of agreement of 46 OS.No.3352 of 1993 sale of land that has to be decided with reference to conduct of parties, and evidence on record. He further relied on a decision reported in (2012) 5 Supreme Court Cases 403. This is with respect to Sec.20(2)(b) of S.R.Act. As already stated above, in view of the facts and circumstances of the present case, the defendants cannot claim discretion as contemplated under Sec.20 of S.R.Act. He further relied on a decision reported in (2004) 8 SCC 689. This is with respect to time is the essence of contract or not. In the present case by issuing notice as per Ex.P.35, the defendants have given away the contention that the time is the essence of contract as per Ex.P.39. He further relied on a decision reported in AIR 2017 Supreme Court 1236, wherein it is held as follows:-
"B" S.R.Act, Sec.16- Suit for specific performance. Maintainability . Mere fact that plaintiff did not seek declaration that termination of agreement is bad. Cannot be a ground to dismiss suit as not maintainable."
29. In the present case, the defendants relying on Ex.P.35 contended that without claiming declaration that the termination of agreement as per Ex.P.39 and without seeking declaration that the said termination is bad under law, the suit cannot be decreed. In view of the decision relied on by the plaintiff in AIR 2017 SCC 1236, Clause "B" , on that ground, suit cannot be dismissed as not 47 OS.No.3352 of 1993 maintainable. Hence, the contention of the defendants in that regard cannot be accepted.
30. He further relied on a decision reported in (2011) 12 SCC 18. This is also with respect to whether the time is essence of contract, wherein it is held that "determination of with respect to performance of specific term only of contract. Held question whether time is of essence of performance can be considered either with reference to contract as a whole or with reference to particular term or condition of contract, which is breached. Thus where time was specified for payment of sale price as in present case, but not in regard to execution of sale deed, held time will become of the essence only with reference to payment of sale price, but not in regard to execution of sale deed."
"B" Time if of the essence of performance of specific obligation on term only in contract. Determination of agreement of sale of immovable property. Term in agreement providing that balance sale consideration was to be paid on scheduled dates in three installments stating it as essence of contract and in case of failure on part of purchaser to do so, vendor shall cancel said agreement. Another term in agreement providing for execution of sale deed at convenience of purchaser. On failure of appellant purchaser to make last two installments on time as agreed, agreement of sale cancelled after due notice. Contention by appellant purchaser seeking specific performance of agreement that time was not of essence of contract and that payment of balance consideration was not made on time since vendor did not provide documents of title to satisfy about title.48 OS.No.3352 of 1993
_ In present case, held terms of agreement were categorical that payment of balance consideration was essence of contract and such payment was not dependent upon purchaser's satisfaction regarding title. There was an unconditional promise to pay the balance consideration in three installments and said promise by purchaser is not dependent upon performance of any obligation by vendors.
-Contract specifically states that having paid balance price, if purchaser is not satisfied about title and if vendors fail to satisfy purchaser about their title, all amounts paid should be refunded to purchaser. This clearly demonstrates that payment of balance of sale price was not made conditional upon purchaser being satisfied about title. Further time was not of essence as to execution of sale deed as sale deed was not required to be executed within any specific period. Manner in which agreement was drafted indicates that purchaser was aware of encumbrances and vendors were in urgent need of money to clear said encumbrances to convey said property.
- Contentions that (1) schedule of payment had been altered by oral agreement, and (2) vendors had committed fraud in concealing encumbrances on property, held not borne out by evidence, and hence, rejected.
Hence, appellant having committed default in paying last two instalments, cannot find fault with vendors for not securing original title deeds. Further stage of execution of sale deed had not arrived as appellants did not pay amount due in terms of contract. Hence, held vendors were justified in terminating agreement of sale for breach of contract by appellants and Court s below were justified in not decreeing specific performance of agreement.49 OS.No.3352 of 1993
"C" Contract and Specific Relief_ Specific performance of contract. Defences respecting suits for relief based on contract. Breach of contract.. Payment of balance consideration made of the essence of contract, but execution of sale deed not made time bound. Payment schedule not having been met and the same amounting to a breach of condition, specific performance held rightly denied.
"D" Time of the essence. Particular contracts where time is of the essence. Sale of immovable property . Held normally in sale of immovable properties time is considered not to be of essence of contract unless such intention is made out either from express terms of contract or implied intention of parties. Detailed reasons given to revisit this position of law, however, due to change in underlying basis thereof with time."
31. In the present case, the time is not the essence of contract as discussed above. The plaintiff has paid Rs.5,00,000/- as advance under Ex.P.39 and as per the said term, the plaintiff was supposed to pay the balance sale consideration only after the sites were formed and sold to the prospective buyers and the balance consideration amount was to be paid only at the time of execution of sale deed by the vendors either in favour of plaintiff or his nominees. Considering over all evidence and decisions relied on by both the parties, this Court is of the opinion that plaintiff is entitled for the relief of specific performance of contract as per Ex.P.39. Hence, I answer Issue No.2 in affirmative and proceed to pass the following:-
50 OS.No.3352 of 1993ORDER Suit of the plaintiff is hereby decreed with costs. The defendants are hereby directed to execute the sale deed in respect of suit schedule property in favour of plaintiff within 60 days from the date of this order after receiving balance sale consideration from the plaintiff.
On failure of execution of sale deed by the defendants, plaintiff is at liberty to apply for the same to this Court.
Draw decree accordingly.
{Dictated to the Judgment Writer, transcribed by her, corrected and then pronounced by me in open court this 7th day of June 2018.} (K.B.PATIL) XI Addl. City Civil Judge Bangalore city.
ANNEXUERE List of witnesses examined for plaintiff:-
P.W.1 Sri.K.L.Sreenivasa Murthy.51 OS.No.3352 of 1993
List of documents exhibited for plaintiff:-
Ex.P.1 Pass book of State Bank of Mysore
Ex.P.2: Receipt dated 7.2.1990 issued by stamp
vendor.
Ex.P.3: Receipt dated 16.8.1990 issued by stamp
vendor.
Ex.P.4: Receipt dated 20.8.1990 issued by agent for
paying commission.
Ex.P.5: Sale deed dated 5.2.1990
Ex.P.6: Bank challand ated 18.8.1990
Ex.P.7: Vysya Bank statement dated 19.9.1991
Ex.P.8: sale deed dated 26.10.1996
Ex.P.9: sale deed dated 27.2.1990
Ex.P.10: Letter dated 23.7.1990 issued by Srinivasa
Murthy.
Ex.P.11: Postal acknowledgment of letter dated
23.7.1990
Ex.P.12: Postal receipt
Ex.P.13: Sale deed dated 15.1.1990
Ex.P.14: Receipt dated 12.3.1990 issued by
B.N.Chandrashekar
Ex.P.15: Sale deed dated 16.4.1990
Ex.P.16: Receipt dated 31.7.1992 issued by
Ravishankar
Ex.P.17: Receipt dated 4.6.1992 and 2.7.1992 given
to B.N.Suresh Babu
Ex.P.18: Receipt dated 18.5.1992 issued by
B.N.Chandrashekar
Ex.P.19: Receipt dated 27.3.1992 issued by
B.N.Chandrashekar
Ex.P.20: Receipt dated 24.1.1992 issued by
B.N.Chandrashekar
Ex.P.21: Receipt dated 17.1.1992 issued by
B.N.Chandrashekar
52 OS.No.3352 of 1993
Ex.P.22: Receipt dated 08.1.1992 issued by
B.N.Chandrashekar
Ex.P.23: Receipt dated 10.1.1992 issued by
B.N.Chandrashekar
Ex.P.24: Receipt dated 18.12.1991 issued by
B.N.Chandrashekar
Ex.P.25: Receipt issued by B.N.Chandrashekar for
receiving Rs.10,000/-
Ex.P.26: Receipt dated 10.12.1991 issued by
B.N.Ravishankar
Ex.P.27: Receipt dated 26.8.1991 issued by
B.N.Chandrashekar
Ex.P.28: Receipt dated 3.9.1991 issued by
B.N.Chandrashekar
Ex.P.29: Counter file dated 11.1.1991 issued by
Vysya Bank
Ex.P.30: Statement of accounts issued by Muysore
Silk Cloth Merchants Co-operative Bank
Ex.P.31: Counter file dated 18.6.1990 issued by
Tamilnad Mercantile Bank
Ex.P.32: Triplicate application under Urban Land
Act, 1976
Ex.P.33: Draft of affidavit
Ex.P.34: Draft of affidavit
Ex.P.35: Legal notice dated 29.4.1993
Ex.P.36: Postal acknowledgment
Ex.P.37: Postal acknowledgment
Ex.P.38: Legal notice dated 26.4.1993
Ex.P.39: Agreement of sale dated 3.1.1990
Ex.P.40: Agreement of sale dated 4.6.1990
List of witnesses examined for defendant/s:
D.W.1 Sri.T.R.Uthamnambi 53 OS.No.3352 of 1993 List of documents exhibited for defendant/s:
Ex.D.1: Reply notice dated 9.5.1993
Ex.D.2: Sale deed dated 18.11.2010.
XI ADDL.CITY CIVIL JUDGE,
BANGALORE CITY