Madras High Court
Govindappa Naidu vs C. Sidda Chetty And Ors. on 9 July, 2003
Author: R. Jayasimha Babu
Bench: R. Jayasimha Babu
JUDGMENT N.V. Balasubramanian, J.
1. This Letters Patent Appeal is directed against the judgment of a learned Judge of this Court in A.S. No. 430 of 1983 dated 17.07.1996.
2. Plaintiff is the appellant herein. The averments of the plaint in brief are that on 19.10.1978 the plaintiff and one Oothappan @ C.K.Chennappa Chetty entered into an agreement of sale in respect of the suit property for a sum of Rs.32,000/-, and on the same date the said Chennappa Chetty received a sum of Rs. 1000/- as advance amount from the plaintiff, as it was agreed between the parties that the balance of the sale price should be paid by the plaintiff before the Sub Registrar at the time of execution of the deed of sale within a period of six months.
3. On 20.11.1978, Chennappa Chetty received a further sum of Rs. 4000/- and made necessary endorsement for the receipt of the same in the deed of agreement of sale. According to the plaintiff, he offered to pay the balance of sale consideration and requested Chennappa Chetty to execute the deed of sale, but Chennappa Chetty was postponing the same and he was demanding more money. The case of plaintiff is that Chennappa Chetty demanded the plaintiff a further sum of Rs. 5000/-, more than the agreed sale price. On 31.10.1979, the said Chennappa Chetty demanded a sum of Rs. 1000/- urgently towards the sale price and the plaintiff paid a sum of Rs. 300/- only. It is the case of the plaintiff that he was ready and willing to perform his part of the contract but Chennappa Chetty was postponing the same under one pretext or other.
4. The plaintiff issued a notice on 10.11.1979 demanding Chennappa Chetty to execute the sale deed, but Chennappa Chetty sent a reply contending that the plaintiff had no money and time is the essence of the contract. It is stated that Chennappa Chetty demanded a sum of Rs. 3500/- more than the agreed sale price and a panchayat was held and in the said panchayat Chennappa Chetty insisted on the payment of a sum of Rs. 3500/- more than the agreed sale price for which the plaintiff did not agree.
5. Chennappa Chetty died on 28.01.1980. Defendants 1 to 6 are his legal representatives and the plaintiff demanded the legal representatives to execute the deed of sale. They have also demanded a further sum of Rs. 3500/-, more than the agreed price, for which the plaintiff was not willing to pay the same. The plaintiff came to know that the defendants were attempting to sell the suit property in favour of the seventh defendant and hence he informed the seventh defendant about the agreement of sale and requested him not to purchase the property. It is stated that the plaintiff went to the Office of the Sub Registrar Office at the time of registration of the sale deed in favour of the seventh defendant and presented a petition to the Sub Registrar objecting to the registration of the deed of sale. The Sub Registrar directed him to seek his remedy in a court of law. It is the case of the plaintiff that the seventh defendant has purchased the property knowing fully well about the agreement of sale in favour of the plaintiff. The plaintiff has stated that he was ready and willing to perform his part of the contract and was ready to purchase the property and hence the suit has been filed for specific performance.
6. The case of the defendants 1 to 6 is that it is false to state that the plaintiff requested Chennappa Chetty or the defendants to execute the deed of sale and the plaintiff has not paid the balance of sale consideration of Rs. 26,700/- before the expiry of six months from the date of agreement. It is stated that there was no demand for the execution to the deed of sale and when the plaintiff apprehended that the suit property may be sold, he sold a portion of his land and mustered a portion of the sale consideration after one year and even then he was not in a position to pay the entire sale consideration. It is stated that the time of six months stipulated in the agreement is the essence of the contract, as Chennappa Chetty required money for the purpose of performance of the marriage of his daughter within six months. It is stated that notice issued by the plaintiff was after one year from the date of agreement.
7. It is stated that there was a family partition of the suit property and the eastern half portion of the suit land fell to the share of the second defendant and the western half portion of the suit land fell to the share of the first defendant and they were in possession and enjoyment of the same. It is stated that the second defendant has sold his eastern half share to the seventh defendant, for a sum of Rs. 10,000/- and the first defendant made improvements in the western half of the suit property and the plaintiff has come forward with the suit at a very last stage and hence the plaintiff is not entitled to the relief of specific performance.
8. The seventh defendant has filed a separate written statement stating that he was not aware of the sale agreement between the plaintiff and Chennappa Chetty and he has stated that only at the time of registration of the deed of sale, the plaintiff presented an objection petition before the Sub Registrar and only then he came to know about the agreement of sale. It is his case that the plaintiff has never approached the seventh defendant and he never informed him about the agreement and advised him not to purchase the suit property. Hence, the plaintiff is not entitled to the relief of specific performance and the same is liable to be dismissed.
9. The trial Court, on the basis of the above pleadings, framed necessary issues for consideration and after considering the evidence came to the conclusion that the time is not the essence of the contract and the defendants have failed to perform their part of the contract and thereby committed a breach of contract and the seventh defendant is not a bona fide purchaser for value without any notice and he was aware of the sale agreement and on the above findings, the trial Court granted the decree of specific performance in favour of the plaintiff.
10. Aggrieved by the judgment and decree of the trial Court, the defendants have filed an appeal before this Court and the matter came up before a learned Judge in A.S. No. 430 of 1983. Learned Judge of this Court held that the plaintiff was not ready and willing to perform his part of the contract and there was no explanation for his silence after the issue of notice-dated 10.11.1979 till June 1980, when the suit was filed. Learned Judge also held that the conduct of the plaintiff in not making payment to Chennappa Chetty for execution of the deed of sale within a reasonable time after the expiry of the time stipulated in the agreement and his subsequent conduct in the delay in filing of the suit after the receipt of the reply notice from Chennappa Chetty go to show that the plaintiff was not ready and willing to perform his part of the contract. Learned Judge came to the conclusion that the plaintiff has failed to prove his financial capacity to purchase the property. Learned Judge came to the conclusion that the plaintiff has not come to the Court with clean hands and he has filed the suit on false allegations seeking the relief of specific performance. In this view of the matter, Learned Judge held that the plaintiff is not entitled to the relief of specific performance and allowed the appeal by setting aside the judgment and decree of the trial Court. It is against the judgment and decree, the present appeal has been preferred.
11. Learned Judge delivered the judgment in the appeal on 17.07.1996. Though the Letters Patent Appeal was filed on 4.12.1996, there was a long delay by the appellant in prosecuting the appeal as there was a long delay in representing the papers on three occasions namely, 308 days, 239 days and 172 days, totalling 719 days, and this Court has condoned the delay by order dated 2.2.2000. Since there was a delay in representing the papers, notice in the appeal was not ordered till this Court condoned the delay of nearly 719 days in representing the appeal papers. Hence in the appeal the notice was ordered to the respondents only on 24.3.2000. In the mean time, on 6.11.1997, the seventh respondent has sold the suit property in favour of his wife Rathna, 11th respondent, by a deed of sale and the deed of sale has also been registered. In other words, though the purchaser is the second wife of the deceased seventh respondent, the sale has been completed nearly after 1-1/2 years from the date of the judgment of the learned Judge of this court and before the receipt of the notice in the appeal, which was ordered only on 24.03.2000.
12. During the pendency of the appeal, the seventh defendant/seventh respondent also died and C.M.P. No. 3381 of 2000 has been filed to substitute the legal representatives of the deceased seventh respondent. In the said petition, this Court ordered notice by order dated 24.03.2000 and Mr. C. Lakshmi Narain, entered appearance for the respondents 11 to 16.
13. Heard Mr. V.Raghavachari, learned counsel appearing for the appellant and Mr. C. Lakshmi Narain, learned counsel appearing for the respondents 11 to 16.
14. Mr. V. Raghavachari, learned counsel appearing for the appellant submitted that the agreement was executed on 19.10.1978 and the plaintiff has sold a portion of the property on 15.11.1978 and made the payment of Rs. 4000/- on 20.11.1978. He also submitted that the plaintiff has sold his entire property on 11.4.1979. On 25.10.1979 Chennappa Chetty demanded a further sum of Rs. 5000/-, but the plaintiff has stated that he would pay the entire sale consideration after the execution of the sale deed, but Chennappa Chetty went away stating that he would receive the entire balance of the sale consideration before the Sub Registrar. He also referred to the payment of Rs. 300/- on 31.10.1979 and submitted, the fact that Chennappa Chetty has received a sum of Rs. 300/- on 31.10.1979 shows the time is not the essence of the contract, as the amount was received by him long after the expiry of period of six months from the date of agreement namely, 19.10.1978. He also referred to the sale deed dated 15.11.1978 by which the plaintiff has sold one of his property for a sum of Rs. 3000/- and referred to the notice dated 10.11.1979 and the reply sent by Chennappa Chetty on 14.11.1979. He also referred to the deed of partition between Chennappa Chetty and defendants 1 and 2 dated 16.11.1979 and submitted that the partition was effected immediately after the notice was issued by the plaintiff to evade the execution of the sale deed in favour of the plaintiff. He further submitted that on 28.01.1980 Chennappa Chetty died and the defendants 1 to 6 became his legal heirs and a sale deed was executed by the second defendant in favour of the seventh defendant on 26.05.1980. He submitted that the suit was filed immediately on 18.06.1980. He further submitted that the plaintiff was always ready and willing to perform his part of the contract and the time is not the essence of the contract and the learned Judge is not correct in holding that the plaintiff was not ready and willing to perform his part of the contract.
15. The learned counsel for the appellant submitted that at the time of filing of the suit, the entire balance of the sale consideration was deposited into Court, which shows his readiness and willingness to perform his part of the contract and in and in support of his above contention, he referred to the decision of the Supreme Court reported in SYED DASTAGIR Vs. T.R. GOPALAKRISHNA SETTY and submitted that on the basis of the above judgment of the Supreme Court, when the plaintiff has deposited the entire sale consideration, without the Court order, it could be construed that the plaintiff was ready and willing to perform his part of the contract. He submitted that it is not essential that the plaintiff should prove that he had money at all point of time and relied on the decision of this Court reported in KANDASWAMI MUDALIAR Vs. MUNUSWAMY UDAYAR & ORS. (1974 (1) MLJ, 62) in support of his submission.
16. He also referred to the decision of the Supreme Court in NATHULAL Vs. PHOOLCHAND and contended that the plaintiff need not produce cash to show his capacity to disclose his obligation under the agreement and what is essential is that the plaintiff must have capacity to pay the balance of sale consideration and relied on the decision of the Supreme Court in SUKHBIR SINGH Vs. BRIJ PAL SINGH . He also relied on the decision of the Supreme Court reported in MOTILAL JAIN Vs. SMT.RAMDASI DEVI & ORS. (2001-1-L.W.388) and submitted there was no delay and the conduct of the plaintiff does not show that he has waived his rights under the sale agreement. He also relied on the decision of the Supreme Court in SURYA NARAIN UPADHYAYA Vs. RAM ROOP PANDEY and submitted that the decision would support the appellant's case.
17. He also referred to the decision of the Supreme Court in MOTILAL JAIN Vs. RAMDASI DEVI and submitted that mere delay in filing the suit is not sufficient to seek for the relief of specific performance. He referred to the decision of this Court reported in MOHAN BREWERIES & DISTILLERS LTD. Vs. SUDHARSHAN TRADING CO. LTD. (2002(1) TLNJ, 65) and submitted that ordinary rule is that specific performance should be granted and ought to be denied only when equitable considerations point to its refusal and circumstances show that the grant of damages would be the better relief. He referred to the Supreme Court decision reported in BORAMMA Vs. KRISHNA GOWDA and submitted that the plaintiff has sold all his land for the purchase of the suit property and he was ready and willing to perform his part of the contract and the denial of the relief is not proper.
18. Learned counsel also referred to the decision of the Karnataka High Court reported in N. VENKATAPPA Vs. LINGAPPA REDDY (AIR 1998 Karnataka, 372) and submitted that the decision of the Karnataka High Court supports the plaintiff's case as he has proved that he was continuously ready and willing to perform his part of the contract. Learned counsel referred to the decision of the Supreme Court in CHAND RANI Vs. KAMAL RANI and submitted that in the case of immovable property there is no presumption that the time is the essence of the contract and further submitted that the plaintiff has been ready and willing to perform his part of the contract from the date of the agreement. He has also referred to the decision reported in INDIRA KAUR Vs. SHEO LAL KAPOOR (1988 SC, 1074) and JIWAN LAL Vs. BRIJ MOHAN and submitted that it is not a case of waiver and the Learned Judge was not correct in holding that the plaintiff was not ready and willing to perform his part of the contract. His submission was that the seventh defendant was aware of the suit agreement and this fact is clear from the deposition of D.W.1. He further submitted that since the time is not the essence of the contract and the plaintiff has exhibited his readiness and willingness to perform his part of the contract. Learned Judge was not correct in allowing the appeal.
19. Mr. C. Lakshminarain, learned counsel appearing for the respondents 11 to 16 on the other hand submitted that the plaintiff was not ready and willing to perform his part of the contract and the evidence produced by the plaintiff clearly shows that he was not having requisite money to perform his part of the contract and six months time stipulated in the agreement had expired on 19.04.1979 and after that the plaintiff sold the property for only Rs. 2000/- on 11.04.1979 and the suit was instituted on 18.06.1980 after the receipt of the reply dated 14.11.1979. Accordingly, the conduct of the plaintiff clearly shows that he was not ready and willing to perform his part of the contract and the plaintiff has not established that he has requisite capacity to pay the balance of sale consideration and he has also not produced the stamp papers purchased by him. Learned counsel also submitted that the plaintiff has come with a false case.
20. We have carefully considered the submissions of the learned counsel for the appellant and the learned counsel for the respondents 11 to 16.
21. There is no dispute that the plaintiff has entered into an agreement of sale with Chennappa Chetty for the purchase of the suit property for a sum of Rs. 32,000/- and a sum of Rs. 1000/- was paid as advance on the date of agreement. The sale agreement provides a period of six months for completion of the sale. The plaintiff sold his property on 22.02.1979 for a sum of Rs. 2000/-. The plaintiff has paid a sum of Rs. 4000/- on 20.11.1978. The plaintiff has admittedly has not completed the sale transaction within the period of six months from the date of the agreement. The plaintiff has not completed the transaction within the reasonable time even after 11.04.1979. The case of the defendants is that the time is the essence of the contract as the marriage of the daughter of Chennappa Chetty was to be performed and the money was required for the performance of the marriage. It is no doubt true that on 31.10.1979 after the expiry of a period of one year from the date of agreement, the plaintiff has paid a sum of Rs. 300/- but Chennappa Chetty demanded a sum of Rs. 1000/- towards the sale consideration. On 5.11.1979 plaintiff's sister has sold her property for Rs. 15,000/-, as seen from Ex.B.3, but there is no evidence to show that the amount was available to the plaintiff nor there is any evidence to show that she was willing to accommodate the plaintiff. Hence, it is not open to the plaintiff to rely on Ex.B.3 to contend that the sale proceeds of the said sale deed was available for the plaintiff. It is relevant to mention that the document Ex.B.3 was not produced by the plaintiff and it is a defendant's document. Even assuming that Rs. 15,000/- covered under Ex.B.3 was available to the plaintiff, there would be still shortfall in the purchase consideration of more than 25% of the purchase consideration, for the availability of which there is no evidence from the plaintiff.
22. The plaintiff issued the notice on 10.11.1979 for which a reply was sent on 14.11.1979 by Chennappa Chetty stating that the time for performance has expired and the plaintiff is not entitled to claim the relief of specific performance. Even thereafter, the plaintiff kept quiet. Chennappa Chetty died on 28.01.1980 and the suit was filed on 18.06.1980. We are of the view that nothing prevented the plaintiff from instituting the suit immediately after the receipt of reply notice dated 14.11.1979 Ex.A.3 sent by Chennappa Chetty or soon after the death of Chennappa Chetty.
23. It is well established that the plaintiff need not produce the actual cash before the Court to show that he was ready and willing to perform his part of the contract. However, the plaintiff should establish his capacity to pay money and he was ever ready and willing to perform his part of the contract. We find on evidence that the plaintiff has not established that he has the requisite financial capacity to pay the sale consideration either within the time stipulated in the agreement or within a reasonable time thereafter. The plaintiff approached the Court only after the sale deed was executed in favour of the seventh defendant by the second defendant on 26.05.1980 and till then he was keeping quiet and there is absolutely no evidence to show that he was ready and willing to perform his part of the contract.
24. As far as the decision relied on by the appellant reported in SYED DASTAGIR Vs. T.R. GOPALAKRISHNA SETTY is concerned, it does not help the appellant as in that case the plaintiff has established that he was ready and willing to tender the balance of sale consideration for the performance of the contract and the balance amount to be paid in that case was only Rs. 120/- and that sum was deposited in the Court to show that the plaintiff was ready and willing to perform his part of the contract. The Supreme Court in HIS HOLINESS ACHARYA SWAMI GANESH DASSJI Vs. SITA RAM THAPAR has taken the view that the factum of readiness and willingness to perform the plaintiff's part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The Supreme Court has held in that case that the facts of the case demonstrated that the plaintiff was not ready nor had the capacity to perform his part of the contract due to his financial incapacity to pay the consideration as contracted and intended to bide for the time which would disentitle him to claim the relief.
25. In N.P. THIRUGNANAM Vs. R. JAGAN MOHAN RAO the supreme Court has held that under Section 16(c) of the Specific Relief Act the continuous readiness and willingness on the part of the plaintiff is a condition precedent for the grant of the relief of specific performance. The Supreme Court has further held that the amount of consideration which has to be paid by the plaintiff to the defendant must of necessity be proved to be available, right from the date of the execution till date of the decree and he must prove that he is ready and has always been willing to perform his part of the contract. On the facts of the case, the plaintiff has not established that he was ready and willing to perform his part of the contract and even after the denial by Chennappa Chetty, the plaintiff had kept quiet and filed the suit after the second defendant executed a sale deed covering a portion of the suit property.
26. Learned counsel for the appellant relied on the decision of the Supreme Court in MOTILAL JAIN Vs. SMT. RAMDASI DEVI & ORS. (2001-1-L.W.388), wherein it was held as under:
"It may be apt to bear in mind the following aspects of delay which are relevant in a case of specific performance of contract for sale of immovable property: (i) Delay running beyond the period prescribed under the Limitation Act; (ii) Delay in cases where though the suit is within the period of Limitation, yet: (a) due to delay the third parties have acquired rights in the subject-matter of suit; (b) 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."
In the instant case there was a delay on the part of the plaintiff due to which the third parties right intervened in the subject-matter of suit and the plaintiff has also not established that he was ready and willing to perform his part of the contract within the period of six months from the date of the agreement or within a reasonable time thereafter. As far as the payment of Rs. 300/- on 31.10.1979 is concerned, even the plaintiff's own evidence shows that Chennappa Chetty demanded a sum of Rs. 1000/- but the plaintiff has paid a sum of Rs. 300/- only. If the plaintiff had money and had capacity to pay the sale price on 31.10.1979, he would have obtained the sale deed or paid at least a sum of Rs. 1000/- and his very conduct shows that he was not having the money or financial resources to pay even a small sum of Rs. 1000/-. Moreover, the plaintiff issued a notice only on 10.11.1979 after six months from the date of the expiry of the sale agreement and hence, the payment of Rs. 300/- does not advance the case of the plaintiff.
27. In this connection, it is relevant to notice a judgment of the Supreme Court in Manjunath Anandappa Urf. Shivappa Hanasi v. Tammanasa and Ors. (2003-3- L.W.5) where the Supreme Court has reiterated that in terms of the provision of section 16(c) of the Specific Relief Act, it is incumbent upon the plaintiff both to aver and prove that he had all along been ready and willing to perform the essential terms of contract which were required to be performed by him. In the case before the Supreme Court, the plaintiff filed the suit almost after a period of six years from the date of agreement of sale and the plaintiff did not bring in any material to show that he had ever asked the owner of the property to execute sale deed and he filed the suit only after he came to know that the suit land had already been sold in favour of a third party. Here also, the plaintiff has not established that he had always been ready and willing to perform the terms of the contract and even after the denial by Chennappa Chetty, the plaintiff kept quiet and filed the suit only after the property was sold in favour of the seventh defendant. We are of the view, the ratio laid down by the Supreme Court in Manjunath Anandappa Urf. Shivappa Hanasi's case would squarely apply to the facts of the case.
28. We have gone through the other decisions relied on by the learned counsel for the appellant and those decisions are not applicable to the facts of the case on hand as the facts clearly indicate that the plaintiff was not ready and willing to perform his part of the contract.
Another important aspect is that it is the specific case of the defendants that time is the essence of the contract. The agreement of sale stipulates six months period for the performance of the obligations of the contract and it is also stated that time has been fixed due to the fact the marriage of the daughter of Oothappan was to be performed. The plaintiff has not rebutted the terms and conditions contained in the sale deed either by examining the scribe or the attestors, though available, and hence it must be held that the plaintiff has violated one of the terms of the agreement as he was not ready and willing to perform the essential terms of the contract.
29. The decision relied on by the learned counsel for the respondents in K. KALIANNA GOWNDER Vs. A. KALIANNA GOWNDER (1986-II-MLJ, 470) supports their case. There is an additional reason which disentitle the plaintiff from claiming the relief. The plaintiff has come forward with a false case as he has pleaded that Chennappa Chetty demanded more money and there was a panchayat in that regard and in the panchayat also Chennappa Chetty demanded more money and he has stated that only due to the demand of the higher amount by Oothappan there was a delay in the performance of the agreement. The plaintiff has failed to establish the plea for the postponement of purchase nor he establish the plea of panchayat and he has not examined any one of the panchayatdars nor there is any evidence to show that there was a panchayat in which Chennappa Chetty demanded more than the agreed amount which resulted the delay in the performance of the contract. The decision of this Court in PITCHAN AMBALAM Vs. KASI PICHAN AMBALAM (1996-2-L.W. 577) and LAKSHMIAMMAL AND ANR. Vs. S. SENGAMALAI (1996-1-L.W. 785) and RAMASWAMY GOUNDER Vs. VENKATACHALAM (1976(1) MLJ, 243) support the case of the respondents, which are the effect that the suit for specific performance will fail, if the plaintiff comes to the court with unclean hands. Apart from the falsity of the case pleaded by the plaintiff, we have found that the plaintiff was not diligent in prosecuting the appeal. There was a long delay in prosecuting the appeal and due to the delay in representing the papers, the Court did not order notice to the respondents. In the mean time, the seventh respondent has sold the suit property and it is stated that improvements have also been made thereon before the receipt of the notice in the appeal. Further the agreement was entered into on 19.10.1978 and the property has changed hands and in such circumstances, we find it difficult to grant the relief of specific performance as the grant of specific performance at this distance of time would cause severe hardship to the defendants as well as to the third parties, to whom the suit property was transferred. Hence, we hold that the learned Judge has exercised his discretion properly in denying the relief of specific performance to the plaintiff and the learned Judge was correct in holding that the plaintiff was not ready and willing to perform his part of the contract and he has not proved that there was sufficient fund to purchase the suit property. We, therefore, hold that the learned Judge was correct in exercising his discretion properly in denying the relief asked for by the plaintiff. We are not inclined to interfere with the judgment rendered by the learned Judge. Accordingly, the appeal fails and the same is dismissed. There will be no order as to costs. Consequently C.M.P. No. 19237 of 2001 is closed.