Bangalore District Court
Sri. Bharath G.Mehta vs Sri. B.Chandrashekar on 20 July, 2018
IN THE COURT OF THE XI ADDL.CITY CIVIL JUDGE,
BANGALORE CITY (C.C.H.No.8)
Dated this the 20th day of July 2018
PRESENT: Sri.K.B.PATIL, B.Com.,LL.B.,(Spl)
XI Addl.City Civil Judge, B'lore city.
O.S.No.9578of 2005
Plaintiff/s: Sri. Bharath G.Mehta,
Aged about 35 years,
S/O Goutham, R/at No.71,
Ajay Arcade,
Vani Vilas North Road,
Basavanagudi,
Bengaluru -560004
(Sri. K.T.Dakappa, advocate for Plaintiff
Vs.
Defendant/s: 1. Sri. B.Chandrashekar,
aged about 69 years,
son of late T.S.Gangappa,
R/at No.7,
Subramanyaswamy temple street,
V.V.Puram,
Bangalore-560004
2. Sri. B.Sadananda,
aged about 67 years,
son of late T.S.Gangappa,
R/at No.473, 10th Main
6th "A" Cross, R.M.V. Extension,
Bangalore-560080
(Sri.H.V.R advocate for defendants )
2 OS.No.9578 of 2005
Date of the institution of suit: 2.12.2005
Nature of the suit: Specific performance
Date of the commencement of 13.1.2010
recording of evidence:
Date on which the judgment was 20.07.2018
pronounced:
Total duration Year/s Month/s Day/s
12 07 18
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 of contract dated 16.7.2004, permanent injunction restraining the defendants from alienating, encumbering the suit schedule property and other reliefs.
2. The case of the plaintiff is that the defendant No.1 and 2 being the owners of the suit schedule property entered into an agreement of sale with the plaintiff on 16.7.2004, agreeing to sell the suit schedule property for R.2,07,44,750/- subject to exact measurement and free from all encumbrances. The plaintiff agreed to purchase 3 OS.No.9578 of 2005 the suit schedule property for the above price. The defendant No.1 and 2 jointly received a sum of Rs.40,00,000/- from the plaintiff as advance sale consideration and in consideration of the receipt of said sum of Rs.40,00,000/- through cheques as well as cash, the defendants executed document No.1 in favour of the plaintiff. The defendants in consideration of the receipt of the said advance sale consideration and part performance of the agreement of sale, delivered to the custody of the plaintiff the following original documents. (1) certified copy of the sale deed dated 22.3.1930 in favour of Sharaf B.Basappa, Settlement deed dated 10.7.1946 executed by S.B.Nanjundaiah and Smt.Gangamma, Transfer of encumbrances from Chinnaswamy to Basappa, Entry and transfer of property pursuant to settlement deed, katha certificate from BBMP dated 4.12.1986, Death certificate of Smt. Devambamma dated 5.6.1988, Nil encumbrance certificate from 1.4.1988 to 26.6.2003, Consolidation of property No.7 and 8 dated 23.1.2004, Katha certificate of consolidated property dated 31.5.2004. The plaintiff is in custody of the said documents as prospective buyer and in part performance of the agreement of sale. Under the said sale agreement, the defendants undertaken to sell the suit schedule property in favour of the plaintiff by making their children as confirming parties to the sale deed, among other terms. The defendants also agreed to deliver the vacant possession of the suit schedule property to the 4 OS.No.9578 of 2005 plaintiff by vacating the suit schedule property in all respects, which was in possession and enjoyment of the 1st defendant. The agreement provides that "The vendors have agreed to share the sale proceeds with their children and that the vendors children have agreed to join the execution of the sale deed as confirming parties. Further in token of their consent that the suit schedule property is the self acquired property of the vendors and that they have no objections over the suit schedule property and they having agreed to join the sale deed as confirming parties signed this agreement as consenting witnesses". The defendant No.1 and 2 in terms of the agreement to get the signature of their children as a consenting witness to the sale agreement. However, only one of the son of defendant No.2 signed as a consenting witness. The 1st defendant represented to the plaintiff that his son Mr.Kiran is living separately and he had shifted himself to different countries and whose whereabouts is not known to the vendors. However, the defendants agreed to execute an Indemnity Bond in favour of the plaintiff. During the month of September 2004 i.e., on 30.11.2004, a joint meeting was arranged in the office of the advocate of the defendants regarding the finalization of the draft sale deed, the registration amount and delivery of vacant possession of the suit schedule property and execution of the sale deed. It was concluded in meeting that the 1st defendant shall vacate the suit schedule property at the 5 OS.No.9578 of 2005 earliest so as to facilitate the registration of the sale deed and that the plaintiff shall pay the amount and get the sale deed as soon as he get the confirmation of schedule property being kept vacant so as to deliver vacant possession to the plaintiff in terms of the agreement. It was also agreed that the sale price for the purpose of registration was fixed at Rs.1,700/- per sq.feet. It was also agreed that the daughter of the 1st defendant and sons of 2nd defendant shall sign the sale deed as consenting witnesses. It was agreed that the plaintiff shall furnish the draft sale deed for approval of the defendants within 4 weeks from the said date. The plaintiff made clear of his readiness and willingness to purchase the property in terms of the agreement on the said date and the defendants also fully satisfied with the plaintiff's preparedness to pay the balance amount in terms of the agreement, but the 1st defendant expressed his difficulty of getting good house for alternate accommodation and in that view of the matter, both the parties have agreed to substitute the terms in so far as the time frame to vacate the suit schedule property and to register the sale deed after it being vacant. In terms of the said meeting and agreement got prepared a draft sale deed and delivered the same to the 1st defendant. The defendants after consultation with their advocate got approved the draft sale deed by making some comments and modifications, accordingly sent the note of approval signed by the 6 OS.No.9578 of 2005 defendants and their counsel on 25.10.2004, the same is produced. In the said not, they never whispered about the date of registration or the capacity of plaintiff to pay the balance amount as alleged in their letters and notices. The plaintiff has been ready and willing to perform his part of obligations by arranging the balance sale consideration. The plaintiff having sufficient money at his command and also approached his banker namely M/S State Bank of India, Rajarajeswari Nagar Branch, Bengaluru. The said banker after scrutiny of the original documents, on the confirmation by the defendants that they are definite of selling the suit schedule property to the plaintiff and after taking into written consent of the defendants and also affidavit, the bank got sanctioned a sum of Rs.75,00,000/- as a purchase loan on 12.10.2004. Thereby the plaintiff made all arrangements to purchase the suit schedule property by arranging the entire funds. The plaintiff is the builder and developer, he having necessary funds to purchase the schedule property from the beginning. The plaintiff has no difficulty to pay the balance sale consideration to the defendants. Apart from the funds in his command, the bank loan, the plaintiff by his own resources capable of paying the balance sale consideration in time without any difficulties. The plaintiff is a builder and a developer doing business under the name and style of M/S Mehta Engineers and Developers. The plaintiff's turnover during the relevant 7 OS.No.9578 of 2005 period was six to seven crores. The plaintiff also eligible for immediate financial from his banker. He also owning money in PPF account of his wife, LIC benefits, as such the plaintiff never find short of funds to purchase the schedule property at any point of time even now. The plaintiff has been ready and willing to purchase the suit schedule property all along from the date of suit even now. There is no default on the part of the plaintiff as alleged by the defendants. It is the defendants, who taking advantage of escalation in the market price and with an oblique motive to blackmail the plaintiff to get abnormal higher amount, made false allegations of plaintiff not having the required funds. The very letter of 17.11.2004, but posted on 18.11.2004 after receipt of the plaintiff letter of demand to execute the sale deed clearly demonstrate the oblique intention of the defendants. Inspite of draft sale deed being approved, the 1st defendant not made arrangements to vacate schedule property as such the plaintiff along with the mediator who is the witness to the agreement personally approach the 1st defendant. The 1st defendant at that time express his inability to vacate the schedule property immediately as such a meeting was conveyed and in the said meeting the 1st defendant requested some more time to vacate the schedule property and assured the plaintiff that, he will intimate the same to the plaintiff. The plaintiff not doubting the bonafides of the 1st defendant has kept quite for some time. However, the plaintiff sent a 8 OS.No.9578 of 2005 letter to the defendants demanding the defendants to specifically perform the agreement on their part by intimating the plaintiff's readiness and willingness to perform the agreement on his part and which facts, the defendants have fully aware. The said letter is produced. The defendants to the shock and surprise after receipt of the letter, got issued a letter dated 17.11.2004 but posted on 18.11.2004 by making unfounded allegations against the plaintiff and which letter was addressed to the old address of the plaintiff as such the plaintiff has no occasion to receive the said letter. But the fact remains same that the 1st defendant has not vacated the schedule property, which is very much evident from the address furnished in the letter of defendants dated 2.12.2004. Thereby the contentions of defendants in the letter dated 17.11.2004 and 2.12.2004 proved to be false. In the 2nd week of January 2005, the plaintiff with the witnesses to the agreement namely Mr. Babulal personally contracted the defendants in their respective addresses and personally requested to receive the balance amount and execute the sale deed. The defendants had agreed to execute sale deed by receiving the balance amount. However, the 1st defendant pleaded for time as he want an alternative accommodation and the 2nd defendant is undergoing major treatment for his ailments and in this regard, the defendants wanted for few months time to specifically perform the agreement. The defendants personally 9 OS.No.9578 of 2005 assured the plaintiff that he should not take the letter in the offensive and that they will not intended to what they had written in their letter dated 17.11.2004. The witness to the agreement, Mr.Babulal Jain is the very close associate of the 1st defendant and in whom, the plaintiff and the defendants had confidence and through whom, the sale transaction was materialized and Mr.Babulal Jain also assured the plaintiff that the defendants are very respectable people in that area and they will not go back by their words and not to take any legal steps. The plaintiff on the assurance of the defendants and the said witness has been awaiting for the registration of the sale deed. To the shock and surprise in the month of September 2004, there are number of persons making telephonic calls to the plaintiff and also personally contacted the plaintiff, stating that the schedule property is for sale and that the defendants are negotiating for sale to the parties. The plaintiff with abundant caution and with a hope that the counsel will prevail upon the defendants and in order to safe guard the interest of the plaintiff got issued a paper publication in the daily newspaper and there afterwards the plaintiff got issued a notice calling upon the defendants to receive the balance sale consideration and register the property. The 1st defendant replied the said notice by his letter dated 22.8.2005. However, he never denied his obligation to sell the property to the plaintiff. The defendants after a month also by their advocate replied on 10 OS.No.9578 of 2005 19.9.2005, but not expressed their unwillingness to sell the property. However, by their reply to the notice through their advocate made unnecessary allegations against the plaintiff in order to cover up their lapses in not specifically performing the agreement, by refusing to execute the sale deed. The plaintiff with a bonafide belief and having ready with the money got prepared the sanction plan and also the working plan. Both are produced. The sanction plan was prepared as per the understanding to register the same along with the sale deed by submitting the said plan in the name of the vendor to the sanctioning authority in order to avoid any delay. The above said work goes to show the intention of the plaintiff is to purchase the schedule property and in fact a known person also booked a flat in the proposed complex in the schedule property. The above conduct of the plaintiff clearly demonstrated the bonafide and honest intention of the plaintiff to purchase the schedule property. It is not made and agreed that time is the essence of the contract in all the meetings and discussions. It was agreed that the sale transaction to be completed in a harmonious manner and without causing much inconvenience to the defendants in as much as the 1st defendant is a senior citizen has to find out alternate accommodation. The 2nd defendant is a chronic patient who is unable to take any extra tension. However, the defendants taking advantage of plaintiff's goodness and with an idea to grab additional money turnaround and 11 OS.No.9578 of 2005 refused to register the sale deed by receiving the balance amount. It is now come to the knowledge of the plaintiff that on earlier occasion, the defendants received advance from third party and then demanded higher amount and refused to register the sale deed and there afterwards, it was cancelled. Hence, the present suit. Plaintiff contended that both on law and on bonafides the plaintiff is entitled to the relief of specific performance of the agreement dated 16.7.2004. The defendants are liable to execute and register the necessary sale deed in favour of the plaintiff, selling the suit schedule sites to the plaintiff by vacating the schedule property and delivering the vacant possession and also getting the signatures of the children as a consenting witnesses. The cause of action for the suit arose on 16.7.2004 and there afterwards on 30.9.2004 when the joint meeting was held, and there afterwards when the plaintiff and Mr. Babulal Jain personally contacted the defendants and also in the month of September 2004, when the defendants made attempt to sell the property and lastly on 19.9.2004 the defendants by their reply refused to perform their part of contract within the jurisdiction of this Court. Hence, prayed for decree the suit.
3. In response to the summons issued in this case, the defendants appeared through their counsel and filed written statement in detail contending that the address 12 OS.No.9578 of 2005 of the plaintiff as given in the cause title is not accurate. Deliberately the plaintiff adopts tactics of giving different address for different correspondences. The address mentioned in the agreement and the address mentioned in the present cause title of the suit are manifestly different with ulterior motives. With the clarification the address of the plaintiff is put to strict proof of the same. Apart from the address of the defendants as given in the cause title, they could also be served though their advocate . The defendants admits the correctness of the averments made in para No.2 and 3 of the plaint. The defendants also admit the correctness of the averments made in para No.4 of the plaint subject to the aspects in relation to the receipt of the amount. The sum of Rs.40,00,000/- was paid as follows:
(a) Each of defendant No.1 and 2 was paid cash of Rs.5,00,000/- in the presence of the witnesses.
(b) Rs.10,00,000/- each was paid by cheques bearing No.151958 and 151959 dated 16.7.2004. As the plaintiff was not having sufficient funds at his disposal he issued cheque for Rs.5,00,000/- each in favour of defendants No.1 and 2 and post dated them to 30.7.2004 when the defendants wanted to present the said cheques for encashment, the plaintiff pleaded with them not to present the same on the date mentioned in the cheque and sought for time and after repeated reminders the plaintiff was able to arrange for the money only on 20.8.2004 to encash the 13 OS.No.9578 of 2005 cheque dated 30.7.2004 and they could encash them only on 20.8.2004. The defendants and the plaintiff agreed as per clause No.5 of the agreement that the sale transaction should be completed within 3 months time and it was also specifically agreed that the time shall be the essence of contract. Both the defendants are senior citizens and 2nd defendant has been unfortunately suffering from terminal ailment namely cancer of pancreas. The suit property is the only property held jointly by the defendants and they did not want to continue to own the property jointly and wanted to have their separate dealings. The defendants wanted to share the sale proceeds with their children in order to settle their life during their life time by purchasing suitable residential accommodation at Bengaluru. The stand taken by the plaintiff in para No.18 of the plaint that it is not made and agreed that time is the essence of the contract in all the meetings and discussions is completely false and denied. The defendants were time and again demanding the plaintiff to complete the sale transaction within the time Specifically agreed to in the agreement to sell and also making it very clear that they would comply with the obligation to be performed by them on their part. The plaintiff has not been ready and willing to perform his part of the contract throughout. The allegations made in para No.14 of the plaint that they wanted time to enable the 1st defendant to secure alternate accommodation or that they wanted a few months time to specifically perform their part 14 OS.No.9578 of 2005 of obligations is completely false and denied. The defendants had complied with all the requests of plaintiff to enable him to raise funds to complete his obligation of getting the sale deed drawn on proper stamp paper and getting it registered by paying the balance sale consideration amount. The defendants were ever ready to hand over vacant possession of the property at the time of registration and in fact the 1st defendant had already shifted his house hold articles from schedule property. Under these circumstances, that the parties agreed and included clauses No.4, 14 and 15, the agreement that the sale transaction should be completed in three months time by further specifically agreeing that time shall be the essence of contract, that on failure of either party to perform his obligation inspite of readiness of other party to perform his obligations, defaulting party should pay liquidated damages of Rs.5,00,000/- and that parties had undertaken that they shall perform their part of contract within the stipulated time of 3 months. The stipulation of time was thus fundamental. The language used by adverting to this aspect thrice is in unmistakable terms clearly shows that time shall be the essence of contract. That is why they insisted on clause regarding time being made the essence of contract being included in the agreement. The defendants were continuously insisting upon the plaintiff to perform his part of obligation by paying the balance consideration at the time of registration of the document and to complete the 15 OS.No.9578 of 2005 transaction on or before 16.10.2004. But the plaintiff who was not ready with the funds went on taking time on one count or the other and though the time for performance of the contract as per the agreement was over by 16.10.2004, only to maintain cordiality and complete transaction, the draft of the sale deed that was received on 21.10.2004 was approved on 25.10.2004, though the time for performance was over by then. In fact the defendants were ready to execute the sale deed even as on that date itself. But the plaintiff by his letter dated 1.10.2004 unilaterally fixed the date for registration of the sale deed as 17.11.2004. That would positively indicate that the plaintiff was not ready with his funds and therefore was not ready and willing to perform his part of contract either on 1.10.2004 or 16.10.2004 or even on 25.10.2004 or 17.11.2004. The plaintiff practically became absconding and his whereabouts were not known for more than 10 months from even 17.11.2004 and he practically abandoned the contract and therefore the agreement for sale stood lapsed. The plaintiff is therefore guilty of breach of contract, the defendants had no other alternative, but to rescind the contract by issuing notice dated 17.11.2004 and as it was not claimed defendants sent copy of the said notice with a covering letter dated 2.12.2004 both by registered post and certificate of posting. All these aspects were again reiterated in the letter dated 12.1.2005 sent by defendants by registered post and certificate of posting. Subsequently, as even admitted by 16 OS.No.9578 of 2005 the plaintiff, there has been escalation of value of real estate and to take advantage of the said escalation, the plaintiff has thought of rekindling the lapsed rescinded contract and got published notice in the paper putting forward all false grounds. Except for the agreement of sale in favour of the plaintiff, the defendants never made any kind of attempt to sell the suit property. The averments made in para No.5 of the plaint that the defendants had undertaken to see that their children would be made confirming parties to the sale deed is partially correct. It has been specifically made clear even in the agreement to sell that defendant No.1 would not be in a position to get confirmation from is son Kiran for the reasons mentioned therein. Therefore, it would not be correct if it is stated that defendants had agreed to get confirmation for the sale deed even from Kiran, son of 1st defendant. As Santhosh Nanda, 1st son of 2nd defendant has been residing in USA he executed a power of attorney in favour of his younger brother Rudresh Nanda to act on his behalf in respect of the transaction in question and the said power of attorney has in fact, been handed over to the plaintiff and Rudresh Nanda was prepared to sign the sale deed as confirming witness both on his behalf and also on behalf of Santhosh Nanda, his elder brother. The allegations in para No.9 of the plaint that there was a joint meeting in the office of the advocate for defendants for finalization of the draft sale deed on 30.11.2004 as false and incorrect and such meeting was held only on 30.9.2004.17 OS.No.9578 of 2005
It is absolutely false to state that it was concluded in the said meeting that the 1st defendant shall vacate the suit schedule property at the earliest so as to facilitate the registration of the sale deed or that the plaintiff would pay the amount and get the sale deed as soon as he got confirmation of suit schedule property being kept vacant so as to deliver vacant possession to plaintiff in terms of the agreement. It is a tissue of lies to state that it was agreed that the sale price for the purpose of registration was fixed at Rs.1,700/- per square feet It is again false to state that it was agreed that the draft sale deed for approval would be furnished within 4 weeks from the said date. It is again false to state that the 1st defendant expressed his difficulty of getting the house for alternate accommodation or in that view of the matter, the parties agreed to substitute the terms in so far as the time frame to vacate the suit schedule property and to register the sale deed after the property became vacant. The defendants denied all other plaint allegations specifically. The plaintiff did not discharge his obligations as above and has invented false excuses by trying to put the blame on defendants. After approval of the draft sale deed by defendants the only things to be attended to by plaintiff were to take actual measurements of the property and arrive at the total sale consideration at the rate of Rs.3,250/- per square feet and incorporate the same in the draft and prepare the sale deed on a proper stamp paper and fix up a date for registration and intimate 18 OS.No.9578 of 2005 defendants about the same and get the document register after payment of balance of sale price also taking indemnity bond from 1st defendant regarding any possible claim by Kiran son of 1st defendant. The defendants were ever ready to discharge their obligation of putting the plaintiff in possession of suit schedule property at the time of registration. The 1st defendant was ever ready to execute the Indemnity bond in favour of the plaintiff. The defendants received plaintiff's letter dated 16.11.2004 before they wrote the letter dated 17.11.2004 is denied. The said letter of the plaintiff was received by 2nd defendant only on 19.11.2004 and 1st defendant has not received that letter at all. Babulal Jain is a very close associate of 1st defendant is denied. There would have been no scope for the said Babulal Jain to canvas in favour of the defendants as alleged in para No.14 of the plaint. The defendants deny that any request was made to the plaintiff not to take any legal steps. The plaintiff has invented all these tissue of lies only to cover up his breach of contract. In fact all these things have been invented by the plaintiff as a counter strategy to the letters of the defendants dated 17.11.2004, 2.12.2004 and 12.1.2005. The contents of plaintiff in para No.16 of the plaint are false The plaintiff resorted to these steps at a later stage only to rekindle a lapsed rescinded contract. As the defendant's counsel Sri.Nargund was abroad, when the 2nd defendant received the legal notice, they intimated the advocate for the plaintiff about the said 19 OS.No.9578 of 2005 fact and also pleaded that after return of the advocate, they would reply. Therefore, there was no scope for them to express anything relating to the merits of the averments made in the notice. Immediately after the return of their advocate from abroad, they have promptly sent a reply notice dated 19.9.2005 bringing out all the fact that had transpired. That there was any understanding to get the sanctioned plan registered along with the sale deed as alleged in para No.17 of the plaint is denied. To the best of the knowledge of these defendants, no sanction has been accorded by the corporation to any plan given by the plaintiff. The contention taken by the plaintiff goes to show that how the plaintiff without paying the balance sale consideration to these defendants as per agreement and getting the sale deed registered has gone to the further step of booking the flats with other parties. Defendants denied the contents of para No.18 of the plaint and stated that is not made and agreed to any of the meetings and discussions is denied. The plaintiff has gone on unnecessarily repeating the same false allegations over and over again in the course of the plaint and defendants have to deny the said allegations though it is a repetition. The parties are agreed that time was the essence of the contract and it was very fundamental to the contract and again the various averments in the agreement point out in unmistakable terms that the parties did agree and mentioned that time shall be essence of the contract. Therefore, there was no 20 OS.No.9578 of 2005 question of having meetings or discussions or to agree therein that time shall not be the essence of the contract and was never ready and willing to perform his part of contract, there is no question of plaintiff showing any goodness to the defendants or the defendants taking advantage of the same. There is again, no question of the defendants trying to grab additional money or that on that account, they have refused to receive the balance of amount. The allegations in para No.18 of the plaint that defendants had received advance on any earlier occasions from a third party or that they demanded higher amount is as vague as it could be. The defendants emphatically deny that they had received any advance from any third party or demanded any higher amount or that they refused to register the sale deed. The plaintiff is not entitled to the relief of specific performance as alleged in para No.19 of the plaint. The defendants are not obliged to execute the sale deed in favour of the plaintiff for the reasons adverted in this written statement. The defendants have never made any attempt to sell the suit schedule property to any person in the month of September 2005 or at any other point of time as alleged in para No.20 of the plaint. There is no cause of action for the suit. As already adverted in the written statement , the defendants wanted to purchase residential accommodation for themselves and their children and with the escalation of the value of real estate, it would be impossible for them to get the suitable accommodation for 21 OS.No.9578 of 2005 the same amount and if the relief of specific performance is granted, the defendants will be put to great hardship because they would not be in a position to accomplish their objective of selling the suit schedule property. The plaintiff has not come to the Court with clean hands . Though he is at fault and not ready and willing to perform his part of contract, he has falsely projected the same on the defendants. Secondly, the plaintiff is guilty of fabrication of documents produced at page 34 styled as "note" as adverted. The plaintiff is therefore guilty of fabrication of document and does not deserve the equitable remedy of specific performance. As already adverted to both the defendants are senior citizens and the 2nd defendant has been undisputedly suffering from the terminal ailment of cancer of pancreas and on account of the breach of contract committed by the plaintiff and further on account of the escalation of the value of the real estate, these defendants will not be in a position to accomplish their avowed object of providing for their children with residential accommodation during their life time and even on this account, the discretion to grant specific performance must be exercised against the plaintiff. The parties had agreed at the time of agreement itself that in case of non-performance of agreement to sell the other side would be entitled to liquidated damages of Rs.5,00,000/- and the defendants by deducing the suit of Rs.5,00,000/- are prepared to pay to the plaintiff even on this day the balance amount of 22 OS.No.9578 of 2005 Rs.35,00,000/-. If plaintiff for any reason is not prepared to accept the said amount, the defendants are prepared to deposit the said amount in the name of this Court or in any nationalized bank in fixed deposit. The defendants are making separate application for permission to deposit the said amount. They denied all other allegations of the plain, which are not specifically denied and are opposed to the tenor of this written statement are denied. On this ground, the defendants prayed to dismiss the suit with costs.
4. On the above facts, the following issues having been framed:-
1. Whether the plaintiff prove that the defendants have agreed to sell the schedule property for total sale consideration of Rs.2,07,44,750/- and executed an agreement of sale dt: 16.7.2004 and received the advance amount of Rs.40,00,000/-?
2. Whether the time is the essence of the contract?
3. Whether the plaintiff prove that he has been always ready and willing to perform his part of the contact?
4. Whether the plaintiff is entitled the relief of Specific Performance of contract?
5. Whether the plaintiff is entitled the relief of Permanent Injunction as sought for?
6. What Order or Decree?23 OS.No.9578 of 2005
5. In order to prove the case of plaintiff's case, the plaintiff himself examined as P.W.1 and one more witness is examined as P.W.2 and got marked Ex.P.1 to P.34. On behalf of defendant, 1st defendant himself is examined as D.W.1 and one more witness is examined as D.W.2 and got marked Ex.D.1 to Ex.D.18.
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 negative;
Issue No.4: In the negative;
Issue No.5: In the negative;
Issue No.6: As per final order for the following
reasons:
REASONS
8. Issue No.1: It is the case of the plaintiff that the
plaintiff agreed to purchase the suit schedule property and defendants are agreed to sell the suit schedule property for a total sale consideration of Rs.2,07,44,750/- executed an agreement of sale in that regard in respect of suit schedule property in favour of plaintiff on 16.7.2004 and received advance amount of Rs.40,00,000/- and thereafter, the 24 OS.No.9578 of 2005 defendants have unilaterally cancelled the agreement by making untenable allegations against the plaintiff and hence, the present suit.
9. The defendants in their written statement have clearly admitted the execution of agreement of sale . The consideration agreed to between the parties and the advance amount of Rs.40,00,000/- received by the defendants from plaintiff under the said agreement. In the present case, from the pleadings and the evidence produced by the plaintiff and defendants, it is clear that there is no dispute as far as execution of agreement of sale dated 16.7.2004. It is also undisputed fact in the present case the total sale consideration amount. The defendants are not dispute the receipt of advance amount of Rs.40,00,000/- under the agreement of sale dated 16.7.2004. In the present case, there is no dispute regarding the title of the defendants over the suit schedule property. The contents of the agreement of sale are also admitted by both the parties. There is no dispute as far as the suit transaction is concerned. Under these circumstances, this Court is of the opinion that the plaintiff has proved the execution of agreement of sale dated 16.7.2004 and the consideration agreed is Rs.2,07,44,740/- and also plaintiff has paid advance amount of Rs.40,00,000/- to the defendants on the date of the said agreement of sale. Hence, I answer Issue No.1 in affirmative.
25 OS.No.9578 of 200510. Issue No.2 and 3: Both these issues are interlinked with each other. Hence I answering both these issues in common to avoid repetition of facts.
11. As already stated at the time of answering Issue No.1 in the present case, the execution of agreement, admitted consideration amount, payment of advance amount of Rs.40,00,000/- is admitted. The only question in the present suit arises is whether the time is the essence of contract or not and whether the plaintiff was and is always ready and willing to perform his part of contract. Though the plaintiff in his plaint has contended that the time fixed to conclude the suit transaction is 3 months from the date of agreement of sale . However, he further contended in his plaint that subsequently it is not made and agreed that time is the essence of the contract in all the meetings and discussions held subsequent to the date of Ex.P.1. The defendants are contending that the time is the essence of contract and it is specifically mentioned in Ex.P.1. The same was mentioned in Ex.P.1 thrice to make the time stipulation is the fundamental and the time is the essence of contract. The defendants are senior citizens as 2nd defendant has been suffering from terminal ailment namely cancer of pancreas. The suit schedule property is jointly purchased by the defendants and they did not want to continue to own the property jointly and wanted to have their separate dealings and also the defendants wanted to 26 OS.No.9578 of 2005 share the sale proceeds with their children in order to settle their life during their life time by purchasing suitable residential accommodation at Bengaluru for their children. With this specific purpose, the defendants agreed to sell the suit schedule property in favour of the plaintiff . In Ex.P.1 also at Clause No.5, it clearly mentioned that the vendors and vendee have agreed that the sale transaction to be completed in three months time from the date of Ex.P.1 and it is specifically agreed that the time is the essence of contract. This fact is also made clear in para No.14 contending that in the event of there being failure to perform the terms of this agreement by one party inspite of the other party being ready to perform their part of obligation under this agreement, the defaulting party has agreed to pay a sum ofRs.5,00,000/- as liquidated damages. In Clause No.15 it is contended that the vendors and the vendee have entered into this agreement with clear intention of transferring the schedule property for valuable consideration and both the parties hereby undertake that they perform their part of contract within the stipulated period of three months. From all these contentions mentioned in Ex.P.1, it is clear that the defendants wanted to conclude the suit transaction within 3 months as they were intending to make arrangements for their children for their residential accommodation at Bengaluru during their life time. As already stated above the 2nd defendant was suffering from very serious ailment at the time of Ex.P.1. It 27 OS.No.9578 of 2005 is also admitted fact that defendant No.1 and 2 both are senior citizens. On perusal of Ex.P.1, no obligation is casted upon the defendants to conclude the suit transaction. The obligation on the part of defendants is to hand over actual vacant possession of the suit schedule property on the date of execution of sale deed in pursuance of Ex.P.1. The other obligation of the defendants under Ex.P.1 is to measure the property before execution of sale deed. As per Ex.P.1, Clause No.1, the consideration amount was fixed at Rs.2,07,44,750/- only at the rate of 3,250/- per square feet subject to measurement. As per the documents of title, the suit schedule property measures east to west 50 feet and north to south 130 feet consisting of old building. However on the spot measurement differ & Hence, the condition was inserted in Ex.P.1 to fix the total consideration amount at the rate of Rs.3,250/- per square feet on the basis of actual measurement. In the present case, immediately after 3 months from the date of Ex.P.1 or within the period of said three months, plaintiff has not made any attempts to pay this balance sale consideration amount to the defendants and get execute the sale deed from the defendants with respect to the suit schedule property. The reasons pleaded by the plaintiff is that the 1st is expressed his difficulty of getting good house for alternate accommodation and in that view of the matter, both the parties have agreed to substitute the terms in so far as the time frame to vacate the suit schedule property 28 OS.No.9578 of 2005 and to register the sale deed after it being vacant. The plaintiff has also pleaded that the defendants not permitted the plaintiff to measure the property within a period stipulated. In this regard, no specific pleading is made by the plaintiff as to when he had been to the suit schedule property to measure the same and what steps he has taken after the defendants not allowed the plaintiff to measure the property as contended by him. In the absence of any specific pleadings by the plaintiff in that regard and also in view of the fact that no action was taken by the plaintiff against the defendants for the alleged not allowing the plaintiff to measure the property, the contention taken by the plaintiff in that regard cannot be accepted. It is further pleaded by the plaintiff that the meeting was held in office of advocate for defendants on 30.11.2004 and the plaintiff further contended that the said meeting was arranged regarding the finalization of the sale deed, the registration amount and delivery of vacant possession of schedule property and execution of sale deed and it was agreed that the defendants shall vacate the schedule property at the earliest so as to facilitate the registration of the sale deed and that the plaintiff shall pay the amount and get the sale deed as soon as he get the confirmation of schedule property being kept vacant so as to deliver vacant possession to the plaintiff in terms of the agreement. In this regard, no evidence is produced by the plaintiff in the present case. As per Clause No.8 of Ex.P.1, it was agreed that the vendors 29 OS.No.9578 of 2005 agreed to hand over vacant possession of the suit schedule property on the day of execution of the sale deed. In view of this clear clause in Ex.P.1, the vendors are not supposed to hand over the actual vacant possession of the suit schedule property in favour of the plaintiff before the execution of sale deed. No evidence is produced by the plaintiff to show that the defendants refused to hand over the actual vacant possession of the suit schedule property on the date of the execution of sale deed. Under these circumstances, the pleadings of the plaintiff to the effect that in the meeting alleged to have been held in the office of the defendants on 30.11.2004, it was agreed that the plaintiff shall pay the balance sale consideration amount and get execute the sale deed as soon as he get the confirmation of schedule property being kept vacant so as to deliver vacant possession to the plaintiff in terms of the agreement cannot be accepted. The handing over of possession of the suit schedule property by the defendants in favour of the plaintiff is arises only on the date of execution of sale deed. Apart from this, the plaintiff has to pay the balance consideration amount within the stipulated period of 3 months from the date of Ex.P.1. In the present case, plaintiff has not made any attempts on his behalf to pay the said balance consideration amount to the defendants within the stipulated period. Further the plaintiff has pleaded that in the said meeting held on 30.11.2004, it was agreed that the sale price for the purpose of registration was fixed at 30 OS.No.9578 of 2005 Rs.1,700/- per square feet. But in this regard, no evidence is produced by the plaintiff. The plaintiff in this regard has produced Ex.P.34. The defendants with respect to Ex.P.34 have contended that the said chit was issued by the advocate for defendants for approve the draft sale deed. But they denied the other printed contents of Ex.P.34. Ex.P.34 is the Xerox copy. However since the signature was admitted by the defendants, the said document was admitted in the present case. In Ex.P.34 also it is not mentioned that before execution of sale deed, the defendants were supposed to hand over the actual vacant possession of the suit schedule property. The consideration amount agreed as per Ex.P.1 is Rs.3,250/- per square feet. There is no reason why there is a reference in Ex.P.34 to the effect that the sale deed is to be prepared at the rate of Rs.1,700/- per square feet as contended by the plaintiff in the present case. Plaintiff himself has produced Ex.P.21 the letter issued by the advocate for the plaintiff to the defendant No.1 intimating that in pursuance of the agreement of sale between the plaintiff and the defendants and also in view of the discussions held subsequently, the plaintiff is ready and willing to register the property on or before 17.11.2004 and requested by his client to make necessary arrangements to receive the balance sale consideration and put his client in possession of the property on the date of registration. Ex.P.22 is another letter dated 16.11.2004 written by the plaintiff to the defendant No.1 and 2, wherein it is also 31 OS.No.9578 of 2005 stated that possession of the vacant property is to be handed over after registering the sale deed in favour of the plaintiff by receiving balance sale consideration amount. From all these evidence produced by the plaintiff and the contents of Ex.P.1, it is clear that the defendants were supposed to hand over actual vacant possession of the suit schedule property in favour of the plaintiff on the date of execution of sale deed and not prior to that. Under these circumstances, the contention of the plaintiff that since the defendants have not vacated the schedule property, there was delay in getting execution of sale deed by the plaintiff from the defendants cannot be accepted.
12. The other ground made out by the plaintiff for delay in getting execution of sale deed from the defendants with respect to the suit schedule property is that the 1st defendant represented to the plaintiff that his son Mr.Kiran is living separately and he had shifted himself to different countries and whose whereabouts is not known to the vendors. However, the defendants agreed to execute Indemnity Bond in favour of the plaintiff. He also pleaded that in terms of agreement of sale, it is agreed to get signature of the children of the defendants as consenting witnesses to the sale deed. However, only one son of defendant No.1 has signed as s consenting witness. In this regard,in the agreement of sale itself, it is clearly mentioned that the schedule property is exclusively belongs to 32 OS.No.9578 of 2005 defendant No.1 and 2 and they have got marketable title. It is also clearly mentioned that the vendors have agreed to share the sale proceeds with their children and vendors children named in the agreement of sale have agreed to join the execution of the sale deed as confirming parties, in token of their consent though the schedule property is the self acquired property of the vendors and that the children have no claim over the schedule property and they having agreed to joint the sale deed as confirming parties signed this agreement as consenting witnesses. It is also clearly mentioned in Ex.P.1 that the son of vendor No.1 Mr.Kiran was living separately from Vendor No.1. He had shifted himself to different countries and who definite whereabouts is not known to the vendors. Therefore vendor No.1 is not in a position to get the consent of Mr.Kiran. Whereas the vendor No.2 having two sons namely Santhosh Nanda and Rudresh Nanda, both are majors. The vendor No.1 will make adequate arrangements and he will guarantee the vendee that Mr.Kiran will not object to such transaction. Further agreed that in the event of Mr.Kiran demanding the share in the property, the same will be met by vendor No.1 only. From this it is clear that in respect of alleged claim of Mr.Kiran, the son of defendant No.1, the defendant No.1 agreed to execute Indemnity Bond for any claim made by Kiran in future after the sale deed was executed in favour of the plaintiff in respect of suit schedule property. It is also mentioned in Ex.P.34 that Santhosh Nanda has executed 33 OS.No.9578 of 2005 Power of attorney in favour of Rudresh Nanda. Therefore, Rudresh Nanda will sign as consenting witness on behalf of himself and also on behalf of Mr.Santhosh Nanda and as per Ex.P.34, a GPA was enclosed with the said letter. But the said GPA is not produced by the plaintiff in the present case. In Ex.P.34, it is also clearly mentioned that son Chandra Kiran-Sri.Chandrashekar will execute an Indemnity Bond in favour of the plaintiff with respect to if any claim made by the son of 1st defendant by name Kiran after execution of sale deed in favour of the plaintiff by the defendants. From this it is clear that no obligation was kept pending by the defendants in respect of suit transaction. All these facts that is the execution of Indemnity Bond signing of the children of defendant No.1 and 2 as consenting party to the sale deed is only at the time of execution of sale deed by the defendants in favour of the plaintiff in respect of suit schedule property. As already stated above, the balance consideration is to be paid by the plaintiff at the time of execution of sale deed and the defendants were supposed to hand over actual vacant possession of the suit schedule property in favour of plaintiff only on the date of execution of sale deed. Under these circumstances, the reasons mentioned by the plaintiff for delay in getting execution of sale deed cannot be accepted. As already stated above, the reasons mentioned by the defendants to sell the suit schedule property and also as the defendants wanted to dispose of property to make arrangements to their children 34 OS.No.9578 of 2005 during their life time to acquire residential accommodation at Bengaluru, they were intending to sell the property and Ex.P.1, it was specifically mentioned that the time is the essence of contract. P.W.1 during cross-examination has clearly admitted that as per the agreement of sale, within 3 months, he has to get execute the sale deed by measuring the suit schedule property and on the date of execution of sale deed, the defendants were supposed to hand over the possession of the suit schedule property. He has also admitted that after execution of agreement of sale, the defendants have handed over all the documents necessary for execution of sale deed as demanded by the plaintiff. In the present case, the plaintiff has contended that the time was extended by further meeting after execution of Ex.P.1, but in that regard as already stated above, plaintiff has not produced any evidence. However, during cross-examination, he has stated that he has addressed a letter to the defendants as per Ex.P.21 stating that he would get execute the sale deed before 17.11.2004 and he was required to pay balance sale consideration amount to the defendants on or between 17.11.2004. Even on that day, plaintiff has not executed the sale deed. For this, the P.W.1 has given explanation that balance sale consideration was to be paid on or before 17.11.2004 subject to conditions that the suit schedule property was measured and possession of property to be delivered. But this contention cannot be accepted, because the plaintiff, who is intending to purchase the 35 OS.No.9578 of 2005 property has to get measure the property to pay the total consideration amount and get execute sale deed. There is no evidence produced by the plaintiff to show that any point of time, the defendants have opposed to measure the schedule property. In view of the discussions made above, it is clear that the possession of the property was to be handed over on the date of execution of sale deed and hence, the contention of plaintiff that prior to 17.11.2004, the defendants were supposed to hand over the vacant possession of the suit schedule property cannot be accepted. The defendants in order to show that they have made arrangements for alternative accommodation for their residence have produced documentary evidence as per Ex.D.12, the lease agreement, Ex.D.13 to 17 rent receipts. Except contending that these documents are created, the plaintiff has not produced any other evidence to disprove the said documents. Even otherwise, the possession of the suit schedule property is to be handed over by the defendants in favour of the plaintiff only on the date of execution of sale deed. Under these circumstances, no fault is committed by the defendants in terms of Ex.P.1 and also from the above discussions, it is clear that no obligation is casted upon the defendants to complete the suit transaction. In view of the above discussions and clear recital in Ex.P.1 that the time is the essence of contract and also the reasons mentioned by the defendants for making the time is the essence of contract, as stated above it is clear 36 OS.No.9578 of 2005 that the time is the essence of contract and the plaintiff should have completed the suit transaction within stipulated period or within extended period as per Ex.P.21 within 17.11.2004. Ex.P.1 is dated 16.7.2004. The suit transaction should have been completed on or before 15.10.2004. But by issuing Ex.P.21, plaintiff suo-motto got extended the period up to 17.11.2004 though he has contended that in the subsequent discussion, the time was extended, no evidence is produced by the plaintiff in that regard. Even if we consider that the time is extended up to 17.11.2004, plaintiff should have completed the suit transaction on or before 17.11.2004. Ex.P.21 is dated 1.10.2004. The defendants by issuing letter dated 17.11.2004 itself have clearly stated that the "time is the essence of contract and when the plaintiff is required to complete suit transaction on or before 16.10.2004, but by letter dated 1.10.2004, the plaintiff got extended the date unilaterally to 17.11.2004. The defendants waited for another one month, but plaintiff has not come forward to execute sale deed by paying balance sale consideration and hence, they have forfeited Rs.5,00,000/- as per Clause No.14 of Ex.P.1". In the agreement deems to have been lapsed because on the failure on the part of plaintiff to discharge the obligation under the contract and called upon the plaintiff to return all the documents , which the plaintiff has received immediately from the date of receipt of the said notice as per Ex.P.24.By issuing another letter 37 OS.No.9578 of 2005 dated 12.1.2005 the defendants have reiterated the said contention and also said that the agreement is lapsed and cancelled and they are ready to repay the amount of Rs.35,00,000/- received under Ex.P.1. But after Ex.P.21 and after receipt of reply as per Ex.P.24, the plaintiff has not made any attempts to get complete the suit transaction or to file the suit immediately. On the other hand, the plaintiff has issued suit notice as per Ex.P.2 on 9.8.2005. The day on which, the plaintiff has received Ex.P.24, plaintiff came to know that the defendants were refused to execute sale deed alleging the lapse on the part of the plaintiff. Hence, the plaintiff would have approach the Court immediately , but he has issued notice as per Ex.P.2 on 9.8.2005 and file the present suit on 2.12.2005. For this delay, no explanation is given by the plaintiff. It is true as per the Limitation Act, the period for limitation to file a suit for specific performance is 3 years from the date of agreement, if the time limits is fixed and if time is not fixed, then from the date of refusal to perform by the defendants. But in the present case in view of the specific terms and agreed upon between the parties and also in view of the above discussions, it is clear that the time is the essence of contract, the plaintiff should have completed the suit transaction within the stipulated period or within the extended period as per Ex.P.21. Under these circumstances, this Court is of the opinion that the defendants are proved that the time is the essence of 38 OS.No.9578 of 2005 contract and plaintiff has not performed his part of contract within the stipulated period without any valid reasons.
13. As far as readiness and willingness to perform the part of contract of plaintiff is concerned, the defendants are contended that the plaintiff was never in possession of sufficient funds to complete the suit transaction within stipulated period and he has delayed the suit transaction for want of sufficient funds to pay the balance sale consideration amount as per Ex.P.1 to the defendants. The total consideration amount is upon by the parties under Ex.P.1 is Rs.2,07,44,750/- at the rate of Rs.3250/- per square feet subject to the measurement. Admittedly , the plaintiff has paid only Rs.40,00,000/- as on the date of Ex.P.1 and hence, the balance sale consideration amount was Rs.1,67,44,750/-. Under these circumstances, plaintiff has to produce sufficient evidence to show that within stipulated period, he was having sufficient funds in his possession to complete the suit transaction. In that regard, the plaintiff has produced documentary evidence as per Ex.P.14 the letter issued by SBI providing credit facilities. But the plaintiff has not produced any evidence to show that he has utilized the said facilities in terms of Ex.P.14. Ex.P.15, P.16 are the income tax returns, wherein the income of plaintiff for the year 2004-2005 is Rs.58,80,364/- and Rs.35,36,657/- respectively. Apart from this, the plaintiff has produced documentary evidence to show that 39 OS.No.9578 of 2005 he is having sufficient property in his possession. But the documentary evidence produced by the plaintiff does not disclose that the plaintiff was in possession of sufficient funds to pay the balance sale consideration amount during the stipulated period. He has produced another document issued by SBI having obtained Rs.75,00,000/- loan from SBI as per Ex.P.30. He has applied for loan as per Ex.P.30 on 25.9.2004, legal opinion as per Ex.P.31 was issued on 13.10.2004 and the said loan was valid for only 3 months. Hence, the SBI has withdrawn the said loan approval on 16.2.2005. Even if we consider that the plaintiff was having Rs.75,00,000/- at his disposal that is also not sufficient to pay the balance sale consideration. Readiness and willingness to perform his part of the contract is not only the financial capacity, but the conduct of the party has also to be seen. In the present case, the conduct of the plaintiff discloses that he was not ready to get execute the sale deed by paying balance sale consideration in pursuance of Ex.P.1within stipulated period in view of the discussions made above. Admittedly in Ex.P.1 there is specific recital to the effect that the time is the essence of contract and the suit transaction should be completed within 3 months from the date of Ex.P.1, even in the extended period as per Ex.P.21, the suit transaction was not completed on or before 17.11.2004 as admitted by the plaintiff in the said letter. After issuance of Ex.P.21, plaintiff has got issued letter as per Ex.P.22 making allegations against the defendants that 40 OS.No.9578 of 2005 the plaintiff was ready for registration of the sale deed in terms of contract, however the premises not vacant till on that day and asking the defendants to vacate the property and registered the sale deed by receiving balance sale consideration amount at the earliest. But as already stated above the vacant possession is to be delivered by the defendants in favour of the plaintiff only on the date of execution of sale deed. Even after issuance of letter as per Ex.P.22, the defendants have issued letter as per Ex.P.24 canceling the agreement dated 16.7.2004 and asking the plaintiff to take back the amount given by him as advance after deducting the damages as per Clause No.14 of Ex.P.1. The plaintiff has not filed the suit within a reasonable period. He has waited up to 9.8.2005 the date on which, Ex.P.2 was issued and filed this present suit on 2.12.2005. All these conduct of the plaintiff discloses that the plaintiff was not ready and willing to perform his part of contract within the stipulated period. Under these circumstances, this Court is of the opinion that the plaintiff has failed to prove that he is and was ready and willing to perform his part of contract as per Ex.P.1 within a stipulated period.
14. Advocate for plaintiff relied on a decisions reported in AIR 2000 SC 2408 in a case between Motilal Jain Vs, Smt. Ramadasi Devi and others, wherein it is held as follows:-
41 OS.No.9578 of 2005"(A) Specific Relief Act, S.16 - Specific performance of contract. Delay in filing suit.
Aspects of delay that are relevant.
The following aspects of delay are relevant in a case of specific performance of contract for sale immovable property (a) Delay running beyond the period prescribed under the Limitation Act. Delay in cases where though the suits are within the period of limitation, yet due to delay the third parties have acquired rights in the subject matter of suit, in the facts and circumstances of the case, delay may give rise to plea of waiver or otherwise, it will be inequitable to grant a discretionary relief.
(B) Specific Relief Act. S.160 Contract for purchase of property. Suit for specific performance. Delay. Denial or relief. Contract stipulating for execution of sale deed within 5 months. Purchaser- plaintiff issuing last notice to seller about 14 months after expiry of 5 months period. Suit filed 9 months after last notice. Cannot be said to be belated so as to deny relief of specific performance.
(c) Specific Relief Act. Sec.16(c)- Specific performance of contract. Readiness and willingness. Plea of need not be in specific phraseology of language."
The principle laid down in the above case cannot be made applicable to the present case in view of the terms, there is a specific recital in Ex.P.1 will making the time is the essence of contract and also the reasons have been 42 OS.No.9578 of 2005 mentioned by the defendants for making time is the essence of contract as discussed at the time of answering Issue No.1.
He further relied on a decision reported in (2004) 8 Supreme Court Cases at page 689 in the case of Swarnam Ramachandran and another Vs.Aravacode Chakungal Jayapalan, wherein it is held as under:-
"A" Contract Act. S.55. Time whether of the essence of the contract. Consideration in determination of conveyance of immovable property. Held time is not presumed to be of essence in conveyance of immovable property, but it is of the essence of contract of re- conveyance or renewal of lease. However, the burden of proving whether tine was of the essence is upon the person alleging it, thus giving an opportunity to the other side to rebut such a presumption. Therefore, if such evidence is led and not rebutted, the Court is bound to accept the plaintiff's plea. Further in cases where notice of making time of the essence is given, it is the duty of the Court to examine the real intention looking to the surrounding facts and circumstances of each case."
"(B) Contract Act.S.55- Time as of the essence of a contract. Conveyance of immovable property. Held vendor has no right to make time of the essence of a contract unless he is willing to proceed to completion.
Further held, where vendor makes time of the essence of such contract, purchaser must be shown to be guilty of such gross default as to allow the vendor to rescind the contract. On facts, no such default shown."
43 OS.No.9578 of 2005"(C) Ss.55 and 37- Time if of the essence of the contract. Ascertainment of. Intention of parties. Principles for. Burden onus of proof and pleading in respect of .
Time limits specified in contract. Held prima facie equity treats the importance of such time limits as being subordinate to the main intention of the parties. On facts, there was no justification in the claim to great time as of the essence of the contract. Issue discussed in extensor."
The principle laid down in the above case cannot be made applicable to the present case in view of the terms, there is a specific recital in Ex.P.1 will making the time is the essence of contract and also the reasons have been mentioned by the defendants for making time is the essence of contract as discussed at the time of answering Issue No.1.
He further relied on a decision reported in (2004) 6 SCC 649 in the case of P.D'Souza Vs.Shondrilo Naidu and he relied one more decision relied on ILR 2010 Karnataka page 765 in the case of Syed Zaheer and others Vs.C.V.Siddaveerappa, wherein it is held as follows:-
"(A) Limitation Act 1961. Article.54- Suit for specific performance of a contract. Period of limitation. Time from which period begins to run. Art.54 of the Limitation Act specifies two points of time from which time begins to run for the purpose of computing the period of 44 OS.No.9578 of 2005 three years limitation with regard to filing suits for specific performance of contract. One is the date fixed for the performance of the contract and two, if no such date is fixed then when the plaintiff has notice of the performance being refused."
(C)Specific Relief Act, 1963-Sub.Sec.(2) of Sec.20- Circumstances when discretion may be exercised not to decree specific performance. Discretion to decree specific performance cannot be exercised, when the terms of the contract or the conduct of the parties at the time of entering into contract or the circumstances under which the contract was entered into are such that they give the plaintiff an unfair advantage over the defendant, where the performance of the contract would involve some hardship to the defendant whereas, its non-performance would involved no such hardship on the plaintiff, that it makes it inequitable to enforce specific performance. Further held, while explaining these circumstances, Explanation- 1 speaks about unfair disadvantage.
Explanation-II related to hardship which is a circumstances is favour of the defendant, while Explanation-III and IV are in favour of the plaintiff when in a case where the plaintiff has done substantial acts in consequence of a contract capable of specific performance or refused specific performance, merely because the contract is not enforceable at the instance of the defendant."
He further relied on a decision reported in AIR 2008 Supreme Court page 1205 in the case of Balasaheb Dayandeo Naik (Dead) through L.Rs and others Vs. 45 OS.No.9578 of 2005 Appasaheb Dattatreya Pawar, wherein it is held as under:-
"Specific Relief Act.S.12. S.55- Specific performance. Suit for. Agreement to sell. Defence that time was essence of contract and plaintiff failed to pay within time.
Agreement though specified time for
execution of sale deed. Stipulation for
forfeiture of earnest money in event of failure to execute sale deed also made. Indicates that time was never intended by parties to be of essence. Defendant could not substantiate plea that time was essence of contract and that it was plaintiffs who avoided to plaintiff perform their part. Plaintiffs are therefore entitled to decree."
He further relied on a decision reported in 2011(5) KCCR 4164 in the case of Ali Sab since deceased by LRs Vs. Mr. Mohiuddin Shariff and another, wherein it is held as under:-
"Specific Relief Act , 1963. Sec.10, 16 and 20- Suit for specific performance. Presumption requiring specific performance.
How to construe the presumption contemplated under Sec.10. Discussed."
He further relied on a decision reported in 2009(1) KCCR 468 in the case of Vasantrao Bapusaheb Killedar Vs. Ramachandra @ Ramanathasa, wherein it is held as under:-
46 OS.No.9578 of 2005"A" Specific Relief Act- Sec.16 and 20- Suit for specific performance. Whether specific performance decree could be refused on the ground of inadequacy of consideration. Held, No."
The principles laid down in the above cases cannot be made applicable to the present case in view of the specific recital in Ex.P.1 making the time is the essence of contract to conclude the suit transaction and also the reasons shown by the defendants to make the time is the essence of Court is accepted. Hence, the Sec.54 of Limitation Act cannot be made applicable to the presence case in view of the above said specific recital in Ex.P.1. Hence, the There is no ground for inadequacy of consideration as held in a decision relied upon by the plaintiff in 2009(1) KCCR 468. Hence, the principle laid down in the above case cannot be made applicable to the present case.
15. The only contention of the defendants in the presence case is that since the plaintiff has not performed his part of contract within the stipulated period as per Ex.P.1, the defendants would not make arrangements for their children for accommodation at Bengaluru during their life time as the defendants are senior citizens and the defendant No.2 is suffering from serious ailments. Under these circumstances, the reasons given by the defendants for making a time is the essence of contract has to be accepted and the plaintiff knowing about the reasons 47 OS.No.9578 of 2005 mentioned by the defendants, but the plaintiff has not pefformed his part of contract within stipulated period as per Ex.P.1 and hence, the defendants are not able to make arrangements as at the time of execution of Ex.P.1 for the accommodation of their children at Bengaluru.
16. The advocate for plaintiff further relied on a decision reported in 2007(4) KCCR 2548 in the case of Sri.M.Ponnuswamy Vs. M.Thamarai Kannan and another i.e with respect to Sec.16© and Art.54 of Limitation Act, wherein it is held as under:-
"(A) Sec.16(c) - Readiness and willingness to perform the contract. What is needed is mental readiness and willingness. Merely establishing the factum of financial readiness and willingness is not sufficient.
"(B) Sec.16(c) - Readiness and willingness to perform the contract. What is needed is mental readiness and willingness . Meaning. Mental attitude to get the sale deed is essential. Getting the sale deed would mean that there should be a demand to the seller to execute the sale deed. If not present, then it would not be a readiness and willingness. "
"(C) Art.54 of Specific Relief Act. Starting point of limitation. In the absence of the specific date. Starts from the date of refusal.
In the event, the plaintiff had to put forth any special plea as to why the demand had not been put forth the burden would be on the plaintiff to establish that fact."
48 OS.No.9578 of 2005The principle laid down in the above case cannot be made applicable to the present case in view of the discussions made above.
He further relied on a decision reported in 2017 (4) SCC 654 in the case of A.Kanthamani Vs. Nasreen Ahmed with respect to Sec. 9 and 16 of Specific Relief Act, wherein it is held as under:-
"A"- Suit for specific performance of agreement of sale of immovable property.
Preliminary objections regarding non maintainability of suit on ground of plaintiff's failure to first seek declaration that termination of agreement by defendant vendor was bad in law. Raised in first time in appeal before Supreme Court cannot be allowed.
"B"- Preliminary issue regarding maintainability of suit. Raised for first time at appellate stage not permissible. It must first be raised by defendant in written statement for adjudication on merits by trial Court as a preliminary issued under Order.14 Rule 2 of CPC."
In the present case, the plaintiff prior to filing the suit itself has aware that the defendants have cancelled the agreement because of non performance of obligation by the plaintiff under Ex.P.1 within a stipulated period and hence, the principle laid down in the above case cannot be made applicable to the present case. The plaintiff has not sought 49 OS.No.9578 of 2005 for declaration that the termination of agreement by the defendant vendor bad in law. The plaintiff is not entitled for the protection as held in the above decision.
16. The advocate for defendants relied on a decision reported in 1993(1) SCC 519 between Chand Rani and Kamal Rani, wherein it is held as under:
" Specific Relief Act - Ss 9 & 10 and 16_ Vendee's suit for specific performance of contract for sale of immovable property- Whether time was essence of the contract. No presumption exists. Can be ascertained from express provisions of the contract, nature of the property and surrounding circumstances. Contract stipulating Rs.98,000/- will be paid by the second party to the first party within a period of 10 days only. Despite notices of vendor to perform vendee's part of payment of the stipulated amount, vendee not willing to pay the same unless vacant delivery of possession of part of the property given. In view of the express term of the contract coupled with the conduct of vendee, held, time was essence of the contract and vendee was not ready and willing to perform the contract. Hence, High Court justified in setting aside decree for specific performance granted by trial Court.
As a general proposition of law, in the case of sale of immovable property there is no presumption as to time being the essence of the contract. Even if it is not of the essence of the contract the Court may infer that it is to be performed in a reasonable time, if the conditions are evident;50 OS.No.9578 of 2005
(i) from the express terms of the
contract;
(ii) from the nature of the property,
and
(iii) from the surrounding
circumstances, for example the object of making the contract."
The principle laid down in the above case can perfectly applicable to the present case. In the present case, there is express recital to make the time is the essence of contract. Admittedly the schedule property is in dilapidated condition and the object of making the contract as discussed above, the defendants were senior citizens during their life time , they have intended to make arrangements for the accommodation of their children and also it is admitted fact that defendant No.2 was suffering from serious illness. Hence, in the present case, the time is the essence of contract.
Further he relied on a decision reported in AIR 2009(11) Scale between Narinder Kumar Malik Vs. Surinder Kumar Malik at page 388.
He relied on a decision reported in AIR 2011 Supreme Court 3351 in the case of M/S Citadel Fine Pharmaceuticals Vs. M/S Ramaniyam Real Wstate Plaintiff Ltd., and another, wherein it is held as under:-
51 OS.No.9578 of 2005" (A) Specific Relief Act. Ss.16, 9.
Contract Act, S.55- Suit for specific performance of agreement to sell. Time is the essence of contract as defence. Availability. Contract for sale of urban Land-Express stipulation in contract that time if of essence. Consequences of non-performance within time also stipulated. Obligation to get permission for sale of part of suit land declared surplus placed on purchaser.
Purchaser unable to get permission within time. Vendor had very right to cancel contract and raise defence that time was of essence.
Decree for specific performance could not be granted.
(B)Specific Relief Act - Ss 16, 20- Specific performance. D8scretionary relief. Plaintiff must come with clean hands. Suit for specific performance of agreement to sell. Plaintiff suppressing fact that vendor had returned earnest money on efflux of time to perform contract but plaintiff refused to accept it. Instead claiming alternative relief of direction to vendor to return earnest money at the rate of 24% interest from date of payment till realization . Conduct of plaintiff disentitles him to get relief of specific performance."
He further relied on a decision reported in (2015) 8 Supreme Court cases 695 in the case of Padmakumari and others Vs. Dasayyan and others, wherein it is held as under:-
"(A) Specific Relief Act - S.19(b) -Suit for specific performance of agreement to sell 52 OS.No.9578 of 2005 immovable property- Protection given under S.19(b) of Specific Relief Act to subsequent bonafide purchasers- Availability of in present case. Determination.
(B) Specific Relief Act -Ss 16(b) & (c), 20 and 10- Suit for specific performance of agreement to sell immovable property. Failure of plaintiff to perform his part of contract within the time stipulated in agreement i.e., to pay balance sale consideration of Rs.63,000/- within nine months from date of execution of agreement. Effect of. Held said failure disentitled the plaintiff to obtain decree of specific performance. Plaintiff's contention that question of payment of balance sale consideration would have arisen only after the defendants had discharged their part of contract i.e., after they had measured the suit schedule property, could not be accepted.
Decree granted by Courts below in favour of plaintiff without considering said important legal aspect, held not proper. Hence, set aside."
He further relied on a decision reported in AIR 1967 Supreme Court 868(1) in the case of Gomathinayagam Pillai and others Vs. Palaniswami Nadar, wherein it is held as under:-
"(A) Contract Act, S.55- Time when essence of contract. Fixation of period within which contract is to be performed does not make stipulation as to time essence of contract. Nor default clause in contract by itself evidences intention to make time of essence. Time is of essence, if parties intend it to be so. Intention may be evidenced 53 OS.No.9578 of 2005 either by express stipulations or by circumstances which are sufficiently strong to displace ordinary presumption that in contract for sale of land stipulation as to time is not of essence. If time is not of essence originally, it can be made of essence even subsequently by serving notice on other party."
17. From the discussions made at the time of answering Issue No.2 and 3 and recitals of Ex.P.1 agreement of sale and the circumstances under which, the defendants agreed to sell the suit schedule property, it is clear that the time is the essence of contract. The plaintiff has not made out any special grounds to avail the benefit of Sec.20 of Specific Relief Act i.e., discretion in his favour as contemplated under Sec.20 of Specific Relief Act, no such circumstances available in the present case in view of the discussions made above. Hence, I answer Issue No.2 in affirmative and Issue No.3 in negative.
18. Issue No.4 and 5: In view of the discussions made at the time of answering Issue No.1 to 3, the circumstances, under which the agreement of sale was executed by the defendants in favour of the plaintiff to sell the suit schedule property, it is clear that the time is the essence of contract, plaintiff has not made honest efforts to complete the suit transaction within the stipulated period . The plaintiff also failed to pay he has always been ready and 54 OS.No.9578 of 2005 willing to perform his part of contract. Hence, the plaintiff is not entitled for the relief of specific performance of contract.
19. As per Clause No.14 of Ex.P.1, there is a recital to the effect that the vendors and the vendee have agreed that in the event of there being failure to perform the terms of this agreement by one party inspite of the other party being ready to perform their part of the obligation under this agreement, the defaulting party has agreed to pay a sum of Rs.5,00,000/- as liquidated damages to the other party. In pursuance of this recital and also in view of the notice of cancellation of agreement issued by the defendants as per Ex.P.24, the defendants have deposited Rs.35,00,000/- by deducting Rs.5,00,000/- towards damages as per Clause No.14 of Ex.P.1 in the present case. Defendants filed I.A.No.3 under Sec.151 of CPC seeking permission to deposit Rs.35,00,000/- in the present case and the said application was allowed by this Court on 9.10.2006. Under these circumstances in the event, the defendants have deposited the said Rs.35,00,000/- in the present case. In pursuance of the said order, the plaintiff is at liberty to receive the same. In view of the discussions made above, the defendants are entitled for the liquidated damages of Rs.5,00,000/- in pursuance of Clause No.14 of Ex.P.1. With this observation, I answer Issue No.4 and 5 in negative.
55 OS.No.9578 of 200520. Issue No.6: In view of my findings on the above issues and discussions made above, I proceed to pass the following:-
ORDER Suit of the plaintiff is hereby dismissed.
The plaintiff is at liberty to withdraw the amount of Rs.35,00,000/- if deposited by the defendants in the present case in pursuance of order passed on I.A.No.3 No order as to costs.
Draw decree accordingly.
{Dictated to the Judgment Writer, transcribed by her, corrected and then pronounced by me in open court this 20th day of July 2018.} (K.B.PATIL) XI Addl. City Civil Judge Bangalore city.
ANNEXUERE List of witnesses examined for plaintiff:-
P.W.1 Sri.Bharath G.Mehtha
P.W.2: Sri.M.Babulal Jain
56 OS.No.9578 of 2005
List of documents exhibited for plaintiff:-
Ex.P.1 Agreement of sale dated 16.7.2004 Ex.P.2: Legal notice dated 9.8.2005 Ex.P.3 & 4:: Postal acknowledgments Ex.P.5: Reply notice dated 19.9.2005 Ex.P.6: Letter written by 1st defendant to advocate for plaintiff Ex.P.7: Certified copy of sale deed dated 22.3.1930 Ex.P.8: Certified copy of settlement deed dated 10.7.1946 Ex.P.9 & 10: Two encumbrance certificates Ex.P.11: Katha certificate in respect of suit schedule property Ex.P.12: Death certificate of Devambamma Ex.P.13: Approved plan Ex.P.14: Letter dated 8.1.2007 written by SBI to plaintiff Ex.P.15 & 16:: Income Tax returns for the period of 2004-
2005 and 2005-2006 Ex.P.17: Letter written by defendants to plaintiff dated 2.12.2004 Ex.P.18: Another katha certificate in respect of suit schedule property Ex.P.19: Assessment order in respect of suit schedule property Ex.P.20: Letter written by advocate for plaintiff to defendant dated 24.1.2006 Ex.P.21: Copy of letter dated 1.10.2004 sent by the advocate for plaintiff to 1st defendant Ex.P.22: Copy of the letter dated 16.11.2004 sent by plaintiff to 1st defendant Ex.P.23: Letter dated 2.12.2004 written by defendants to plaintiff Ex.P.24: Another letter dated 17.11.2004 written by defendants to plaintiff Ex.P.25: Another letter dated 12.1.2005 written by defendants to plaintiff Ex.P.26: Notice in Paper publication in Deccan Herald daily newspaper dated 21.8.2004 57 OS.No.9578 of 2005 Ex.P.26(a): Concerned advertisement in Ex.P.26 Ex.P.27: Affidavit dated 27.8.2004 by 2nd defendant Ex.P.28 & 29: Postal acknowledgments;
List of witnesses examined for defendant/s:
D.W.1: Sri.B.Chandrashekar D.W.2: Sri. H.S.Chandramouli
List of documents exhibited for defendant/s:
Ex.D.1: Notice dated 16.11.2004 issued by the plaintiff to defendant No.1 Ex.D.2: RPAD cover Ex.D.3: Office copy of letter dated 212.2004 D.3(a) & (b) Postal receipts D.3© to (e): Postal certificates dated 2.12.2004 D.3(f): Postal A.D. Ex.D.4 & 5: Postal covers Ex.D.6: Office copy of letter dated 12.1.2005 Ex.D.7: Under certificate of posting Ex.D.8: Postal acknowledgment Ex.D.9 & 10: RP cover Ex.D.11: Medical certificate Ex.D.12: Agreement of lease Ex.D.13 to 17: Rental receipts Ex.D.18: Letter XI ADDL.CITY CIVIL JUDGE, BANGALORE CITY 58 OS.No.9578 of 2005