Delhi District Court
Girish Sharma vs . H. P. Rajpal & Ors. Judgement Dt. ... on 23 May, 2015
Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015
IN THE COURT OF ADDITIONAL DISTRICT JUDGE13, CENTRAL,
TIS HAZARI COURTS, DELHI
ID No. 02401C5024282004
CS No. 183/2014
Girish Sharma
S/o Sh. Rameshwar Sharma
R/o 24/1, West Patel Nagar,
New Delhi. .....Plaintiff
Versus
1. Hari Parkash Rajpal (deceased)
Through his LRs :
a) Sh. Rakesh Rajpal Son
C/o Sh. P. C. Chhabra
B2A - 140, Janakpuri, New Delhi.
b) Smt. Indu Rajpal W/o Late Sh. Yogesh Rajpal
c) Mr. Rohit Raj Pal Both sons of Late
d) Mr. Mohit Rajpal Sh. Yogesh Rajpal
b) to d) are resident of c/o Sh. N. K. Gandhi, BA352, Tagore
Garden, New Delhi.
e) Smt. Neelam Khosla Daughter
R/o B439, Meera Bagh (Outer Ring Road)
New Delhi.
f) Smt. Kiran Gandhi Daughter
R/o BA352, Tagore Garden,
New Delhi.
g) Smt. Renu Chhabra Daughter
R/o b2A140, Janakpuri, New Delhi.
CS No. 183/2014 Page 1 of 65
Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015
2. Shyam Sunder
S/o Sh. Uttam Chand
R/o Flat No. 14, New Market,
West Patel Nagar, New Delhi.
3. Inder Pal
S/o Sh. Uttam Chand
R/o Flat No. 14, New Market,
West Patel Nagar, New Delhi.
4. Smt. Saroj Jain
W/o Sh. Suresh Kumar Jain
R/o 446 DDA Colony, Ranjeet Nagar,
New Delhi.
5. Land and Development Office
Through : Land & Development Officer
Ministry of Urban Development
A Wing, Nirman Bhawan, New Delhi11.
6. United Commercial Bank
through : Manager
Model Basti Branch, Delhi. .....Defendants
Date of filing the suit : 15.5.1990
Date of reserving the judgement : 18.4.2015
Date of judgement : 23.5.2015
JUDGEMENT
Since most of the facts in the present case are not in dispute, therefore, I cull them down as under:
1. Defendants No.1 is the last recorded owner of the single CS No. 183/2014 Page 2 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 storey house measuring 200 sq. yards bearing Municipal No. 24/1 situated in West Patel Nagar, New Delhi110008 by virtue of a sale deed registered on 06.03.1973 in the office of Sub Registrar I Delhi. The property is the subject matter of the suit and hence it will be referred to as 'suit property'.
2. Defendant No.1 entered into an agreement to sell the suit property on 02.02.1983 in favour of defendants No.2 & 3 for a sum of Rs. 5,00,000/.
3. The defendant No.1 entered in a fresh agreement to sell the suit property in favour of defendant No.4 vide an agreement dated 21.2.1983 for a consideration of Rs.5,00,000/.
4. Aggrieved by this conduct, defendants No.2 & 3 filed a Civil Suit No. 829/1983 for specific performance of contract dated 2.2.1983 against the defendant No.1 in High Court of Delhi. Defendant No.4 was impleaded as a defendant in the said suit.
5. During the pendency of the said suit, defendants No. 1 to 4 entered into an agreement with the plaintiff on 5.9.1984 with respect of the suit property vide which defendant No.1 agreed to sell the property to plaintiff for a sum of Rs. 3,60,000/. The present suit is based upon this agreement.CS No. 183/2014 Page 3 of 65
Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015
6. On 10.09.1984, defendants No.1 to 4 filed an application bearing IA No. 5526 of 1984 in the said suit in Hon'ble High Court of Delhi under Order 23 Rule 1 of CPC for recording of compromise between the parties in which it was stated that defendants No. 1 to 4 have settled their dispute and it was agreed that defendant No.1 shall sell the suit property to plaintiff in respect of which agreement to sell has already been executed by defendant No.1 (i.e. agreement dated 5.9.1984) in favour of plaintiff.
7. By virtue of this settlement, all the previous agreements between the defendant No.1 with defendant No.2 and 3 as well as with defendant No.4 came to an end.
8. In compliance of the agreement to sell dated 05.09.1984, the plaintiff had also paid payment of Rs. 3,50,000/ to the defendant no.1 leaving a balance amount of Rs. 10,000/ to be paid to the defendant no.1 at the time of executing the sale deed by defendant No.1 in favour of plaintiff.
9. Thus, after agreement dated 05.09.1984, the defendants No. 2, 3 & 4 have no claim over the suit property.
10. It is not in dispute that at the time of entering into an agreement dated 05.09.1984, the title deeds of the suit CS No. 183/2014 Page 4 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 property were in possession of United Commercial Bank (UCO Bank) (defendant No.6) because defendant no.1 had taken a loan from this Bank by mortgaging the suit property to defendant no.6.
11. As per agreement to sell dated 05.09.1984 defendant No.1 agreed to get the title deeds retrieved from the said bank within two weeks from the date of execution of agreement and sale deed was to be executed within 4 months from the date of the agreement.
12. Hon'ble High Court vide order dated 06.11.1984 disposed of Suit No. 829/1983 in light of the compromise between the parties. I may clarify here that in this suit, plaintiff was not a party rather the suit was only between defendants No. 1, 2, 3 &
4.
13. It is not in dispute that when plaintiff came in possession of the suit property, it was only a single storey structure. Thereafter, plaintiff carried out construction and raised further floors.
14. The original agreement to sell dated 05.09.1984 is not filed in the court. However, its relevant terms & conditions were reproduced in the plaint and the same are not in dispute. The CS No. 183/2014 Page 5 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 photocopy of the agreement to sell is on judicial record, which was denied by defendant no.1 at the stage of of admission and denial for want of original, but its terms and condition are not in dispute. Defendant no.1 also proved its photocopy as Ex.DW1/5.
15. As per these Clause XI of agreement dated 5.9.1984, in case of any dispute between the parties, the dispute would be referred to the sole arbitrator Sh. Rameshwar Sharma S/o Naupa Ram R/o X94, West Patel Nagar, New Delhi.
16. Defendant no.1 executed a Special Power of Attorney dated 20.9.1984 appointing Sh. Rameshwar Sharma as his attorney and authorizing him to move an application to L&DO to seek permission to sell the suit property to plaintiff. Sh. Rameshwar Sharma is father of plaintiff, the named arbitrator as well as the attorney of defendant no.1.
17. Sh. Rameshwar Sharma applied for necessary permission for sale of suit property from Land & Development Office (defendant No.5) but it was not granted because defendant No.1 revoked the Special Power of Attorney appointing Sh. Rameshwar Sharma as attorney of defendant No.1 and wrote a letter dated 19.1.1987 to L&DO informing about such revocation CS No. 183/2014 Page 6 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 of SPA. A public notice was published in Hindi Daily Vyapar Kesari dated 20.05.1987 by defendant no.1 informing the public about revocation of SPA.
18. Since dispute arose between the parties, plaintiff sent a notice dated 20.05.1988 to defendant's No.1 initiating arbitration proceedings as per the terms & conditions of the agreement dated 05.09.1984. This notice is not on record. However, admittedly defendant no.1 had filed OMP No. 56/88 in High Court of Delhi (attested copy of which are Ex.PE). In para 9 of this petition, defendant no.1 has stated that he had received a letter dated 20.5.1988 sent by respondent no.1 (i.e. the plaintiff herein) referring the dispute to the arbitration of Rameshwar Sharma.
19. Defendant No.1 filed a petition under Section 5 & 33 of the Arbitration Act bearing OMP No. 56 of 1988 in Hon'ble High Court of Delhi titled as HP Rajpal Vs. Girish Sharma praying that the arbitrator in agreement to sell dated 05.09.1984 be disqualified to act as the arbitrator because at the time of entering into agreement, it was concealed by plaintiff that named arbitrator was father of the plaintiff. (Ex.PE)
20. Vide order dated 10.06.1988 the High Court restrained Sh.
CS No. 183/2014 Page 7 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Rameshwar Sharma from acting an arbitrator and on 02.02.1990, the plaintiff and defendants sought time to explore the possibility for agreeing upon some common name as an arbitrator. (Para 19 & 21 of plaint and of WS of defendant no.1)
21. However, on 19.03.1990 defendant No.1 declined to refer the matter to any other arbitrator. (Para 22 of plaint and of WS of defendant no.1)
22. Since Sh. Rameshwar Sharma was restrained from acting as arbitrator, the plaintiff filed the present suit for specific performance of agreement on 15.5.1990.
23. In view of filing this suit, defendant no.1 informed this fact to Hon'ble High Court, who dismissed OMP No. 56/88 of defendant no.1 as having become infructuous vide order dated 10.5.1991.
24. Defendant no. 6 (UCO Bank) had filed a mortgage suit against defendant no.1 and defendant no.6 had also deposited the original title deeds in the court of Ld. ADJ. The suit was disposed of and defendant no.1 had taken the title deed. The date of retrieving the title deeds is not clear from the records but the same was done during the pendency of this suit. Defendant no.1 admits in his cross examination dated 14.7.2003 that his CS No. 183/2014 Page 8 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 father had taken the title deeds of the property. Agreement to Sell dated 5.9.1987.
None of the parties filed the original agreement. Photo copy of the agreement was filed by plaintiff. At the stage of admission and denial, defendant no.1 denied it for want of the original document. However, the agreement and its terms and conditions were not denied in written statement as well as during the whole of the trial. Rather the same have been admitted by defendant no.1 and his LRs at every stage of the trial including the final arguments. The stand of defendant no.1 in written statement is that the original agreement was destroyed by plaintiff. Nonetheless, the agreement and its terms and conditions are not in dispute and the photo copy of the agreement is admitted being the secondary evidence of a document, which is not available/lost and terms and conditions of which are admitted as per Section 65 of Indian Evidence Act 1872. Moreover, DW1 examined by defendant no.1 proved photocopy of this document as Ex.DW1/5.
I reproduce the said admitted agreement as under :
AGREEMENT THIS AGREEMENT is executed on this of September, 1984, amongst the following :
1. Shri R. P. Rajpal s/o Shri Moti Ram New Delhi CS No. 183/2014 Page 9 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 (hereinafter referred to as the party of the first part).
2. Shri Shyam Sunder s/o Shri Uttam Chand :
Shri Inder Pal s/o Shri Uttam Chand both r/o Flat No. 14 New Market, West Patel Nagar, New Delhi.
(hereinafter referred to as party of the second party).
3. Smt. Saroj Jain w/o Shri Suresh Chand Jain r/o 446 D. D. A. Colony, Ranjit Nagar, New Delhi.
(hereinafter referred to as party of the third party).
4. Shri Garish Sharma s/o Shri Rameshwar Dayal, r/o 24/1, East Patel Nagar, New Delhi.
(hereinafter referred to as party of the fourth part).
2. WJEREAS party of the first part had entered into an agreement for sale of property No.24/1 West Patel Nagar, New Delhi. In favour of party of second part for a consideration of Rs.5,00,000/ (Rs.Five Lakhs) by an agreement dated 2/2/83, under various terms and conditions as contained in the said agreement and had received an earnest money of Rs.60,000/ (Rupees Sixty thousand only), (Rs.30,000/ (Rupees thirty thousand) was received by the party of the first part while Rs.30,000/ (Rupees Thirty thousand) had been given to property broker Shri R. P. Mahajan under receipt). The said agreement did not materialise and consequently party of the second part instituted a suit for specific performance in the High Court of Delhi being suit No.629/83 ...2/ CS No. 183/2014 Page 10 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 2 and the said suit is pending before the hon'ble High Court of Delhi. An application under Order 39 Rule 1&2 for the grant of adinterim stay had been made and adinterm stay was also granted by the hon'ble High Court.
3. THAT PARTY OF THE FIRST PART further entered into an agreement for sale of the same property No.24/1, West Patel Nagar, New Delhi, vide agreement dated 21/2/83 with party of the third part namely Smt. Saroj Jain w/o Shri Suresh Chand Jain for a consideration of Rs.5,00,000/ (Rupees Five Lakhs) and had received a consideration of Rs.4.50 lakhs (Rupees Four Lakhs Fifty thousand) in furtherance of the said agreement. The said party had also made application for being impleaded as a party in the suit pending before the High Court of Delhi and was so impleaded as a proper party.
4. THAT AS THE PARTY OF FIRST, SECOND AND THIRD PART have not been in a position to narrow down their differences or coming to final settlement with respect to sale of property No.24/1, West Patel Nagar, New Delhi. It was, however, mutually agreed by the party to this agreement that party of the fourth part Shri Garish Sharma s/o Shri Rameshwar Dayal will purchase the said property for a consideration of Rs.3,60,000/ (Rupees Three Lakhs Sixty thousand). Any unearned income over and above will be paid to the L&DO directly.
5. THAT THE PRESENT AGREEMENT FOR sale consideration of Rs.3,60,000/ (Rupees Three Lakhs Sixty thousand) has been arrived at to bring to an end the litigation between the party of the first part, second part and third part and to ensure that property is sold in favour of the party of the fourth part without any litigation and for this party of the first, second and CS No. 183/2014 Page 11 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 third part have given their consent to this agreement to sell.
6. NOW IT HAS BEEN AGREED AS FOLLOWS :
I. THAT PARTY OF THE FIRST PART has settled with the party of the second and third part directly and will take such necessary assistance as may be required from the party of the fourth part and ensure that the suit pending before the High Court of Delhi is amicably settled and withdrawn. Whatever amount was due or payable stands paid to the party of the second & third part by the party of first part and their respective agreements have come to an end.
...3/
3
II. THAT FINAL SALE CONSIDERATION OF
Rs.3.60 lakhs (Rupees Three Lakhs and Sixty thousand) was agreed to between the party of the first part and fourth part keeping in view the complication as a result of litigation instituted i the High Court of Delhi by the party of the second, third part against the party of the first part. And with a view to settle down the litigation, it was agreed by all the parties for sale consideration will be only Rs.3.60 lakhs (Rupees Three Lakhs and Sixty thousand) which will be paid by the party of the fourth part to the party of the first part.
III. THAT PARTY OF THE FOURTH PART shall have the right to get the sale deed executed in his name or in the name of his nominee for a consideration of Rs.3.60 lakhs (Rupees Three Lakhs Sixty thousand) out of which the party of the first part has received entire amount except a sum of Rs.10,000/ (Rupees Ten thousand), receipt whereof has been admitted by the party of the first part. Before sale deed is executed the remaining Rs.10,000/ (Rupees Ten thousand) will be paid only at the time of registration of the sale deed CS No. 183/2014 Page 12 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 before the SubRegistrar. Party of the fourth part will also pay to the L&DO any unearned income for getting permission for sale of the property in favour of the said party for aforesaid consideration of Rs.3.60 lakhs (Rupees Three Lakhs Sixty thousand).
IV. THAT IT HAS BEEN AGREED THAT party of the first, second and third part have no objection if property is sold in favour of the party of the fourth part or his nominee and that they have given their consent without any undue influence, coercion or threat and after taking back their respective amount and are willing that matter is sorted out and sale deed executed in favour of the party of the fourth part.
V. THAT PARTY OF THE FOURTH PART is already in possession of the property as a tenant at a monthly rent of Rs.550/ p.m. under party of first part.
VI. THAT SALE PERMISSION will be taken from the L&DO by the parties concerned i.e. party of the first part and party of the fourth part will assist the party of the first part in getting the said sale permission within two months.
VII. THAT PARTY OF THE FIRST PART shall ensure that title deed from the bank are got retired within two weeks from the date of execution of the present agreement. This period, however, may be mutually endorsed by both the parties.
VIII. THAT SALE DEED will be completed within a period of four months from the date of execution of this agreement.
...4/
4
IX. THAT ALL LIABILITIES till the date of
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Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015
execution of the present agreement, will be borne by the party of the first part while subsequent liabilities will be borne by the part of the fourth part.
X. THAT PARTY OF THE second, third part will not put any hindrance, obstruction or inconvenience in the execution of the sale deed by the party of the first part in favour of the party of fourth part. That the party of first part shall also get clearance from Incometax authorities.
XI. SHOULD THERE ARISE any dispute or difference between the parties, the same shall be referable to the sole arbitration of Shri Rameshwar Sharma s/o Shri Naupa Ram, r/o X94, West Patel Nagar, New Delhi, whose decision thereon shall be final and binding.
7. IN WITNESS THEREOF THE PARTIES have put their respective hands on the date and year already mentioned.
H. P. RAJPAL (Party of the first part) Shyam Sunder Inder Pal (Parties of the second part) Saroj Jain (party of the third part) Garish Sharma (party of the fourth part) EXECUTANTS WITNESSES (emphasis supplied) CS No. 183/2014 Page 14 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 The facts on which the parties are not in agreement
1. In the plaint, the plaintiff has stated that he was in possession of the suit property even prior to the agreement in question in capacity of a tenant. On the otherhand, as per WS of defendant No.1 (para4 of the preliminary objections), immediately after execution of the agreement dated 21.02.1983, he had delivered actual physical possession of thee premises to defendant No.4. In para 7 the defendant has taken the stand that it was defendant No.4 Smt. Saroj Jain who delivered the possession of the premises to the plaintiff.
2. In para 7 of parawise reply in WS, the defendant no.1 has stated that the agreement to sell dated 05.09.1984 was not to be acted upon because plaintiff had advanced an amount of Rs. 3,50,000/ to defendant No.1 to enable him to amicably settled the litigation with defendants No. 2 to 4. Defendant No.1 states that said amount was advanced merely as a loan which was to carry interest at the rate of 12% per annum. However, plaintiff compelled the defendant No.1 to execute an agreement sell dated 05.09.1984 with an understanding that said agreement was not to be acted upon as long as defendant No.1 refunded to CS No. 183/2014 Page 15 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 the plaintiff the loan amount with interest. Accordingly, it is stated that agreement to sell is a sham and bogus document. On the other hand, plaintiff is relying upon this agreement in his suit.
3. Defendant No.1 claims that plaintiff took undue advantage of the financial crisis of the defendant no.1 and that defendant was already ready to refund the loan amount but plaintiff did not agree to this. In the revocation of Special Power of Attorney, defendant informed the plaintiff that he was ready to repay the loan amount.
Plaint Plaintiff has based his suit for specific performance on the agreement to sell dated 05.09.1984. It was stated that the time of limitation started from 19.03.1990 when defendant No.1 declined to name an arbitrator in High Court of Delhi in OMP No. 56/1988.. Plaintiff has also prayed a decree of mandatory injunction praying that the United Commercial Bank (defendant No.6) be directed to deposit the title deed of the suit property in the court. However, this relief is now not maintainable because defendant No.1 has retrieved the documents from defendant No.6 during the pendency of this suit. Plaintiff has also sought a decree and mandatory injunction against CS No. 183/2014 Page 16 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Land & Development Office(defendant No.5) to grant sale permission to plaintiff in respect of the suit property.
Written Statement of defendant no.1.
Defendant No.1 filed the written statement stating that the agreement to sell is a sham document and was not intended to be acted upon. It is further stated that the plaintiff had advanced a loan of Rs. 3,50,000/ in favour of defendant No.1 and under compulsion defendant No.1 executed the agreement to sell. He has stated that the plaintiff had agreed to destroy the agreement as it was not required to be enforced and that the document was subsequently destroyed. Counter Claim of defendant no.1.
In the written statement defendant filed counter claim stating that he is ready to return the amount of Rs.3,50,000/ with interest @ 12% per annum to plaintiff and that the agreement to sell dated 05.09.1984 be declared to be a sham document and that the possession of suit property has been obtained by plaintiff as a result of coercion and undue influence. Defendant also claim possession of the suit property but did not pay court fee for the relief of possession of the suit property and only paid total court fee of Rs.50/. Replication & Written Statement to counter claim of defendant No.1:
CS No. 183/2014 Page 17 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Plaintiff filed replication and the written statement to the counter claim of defendant no.1. In WS to counter claim, specific objection was raised that counter claim was not valued property for the purpose of court fee and jurisdiction and sufficient court fee has not been paid by defendant.
Written Statement of Defendants No. 2 to 4:
Defendant no.2 to 4 filed a common written statement in which it is admitted that an agreement was executed by defendant no.1 in favour of defendant no.2 & 3 on 2.2.1983 vide which defendant no.1 agreed to sell the suit property to them for a consideration amount of Rs.5 lacs. However, defendant no.1 unscrupulously executed another agreement to sell in respect of the said property in favour of defendant no.4 vide agreement dated 21.2.1983 without informing defendant no.4 about the prior agreement to sell dated 2.2.1983 in favour of defendant no.2 & 3. Defendants admitted the pleadings in IA No. 5526/1984 in suit no. 829/1983. It is stated that defendant no.1 had earlier let out the suit property to plaintiff at monthly rent of Rs. 550/. It was also admitted that agreement dated 5.9.1984 was executed between defendant no.1 with plaintiff whereby defendant no.1 agreed to sale the suit property to plaintiff for a sum of Rs. 3,60,000/. It is further stated in para 10 of the written statement CS No. 183/2014 Page 18 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 that plaintiff having paid Rs.3,50,000/ to defendant no.1, has to pay only a sum of Rs.10,000/ at the time of registration of sale deed. It is stated that defendant no.1 has agreed in presence of the defendants that he was to get the title deeds retrieved from UCO Bank without two weeks from 5.9.1984 and would hand over the same to the plaintiff. It is further stated in para 13 of the written statement that when the possession of the suit property was given to plaintiff by defendant no.1, it was a single storey building. However, at present, it is two storey building i.e. ground floor and first floor in which the plaintiff and his family members reside.
Plaintiff filed replication to this written statement also. Written statement of Defendant no.5.
Land & Development Office is defendant no.5 in this case, who did not file any written statement, was proceeded exparte. Written statement of Defendant no.6.
UCO Bank (defendant no.6) filed the written statement stating that defendant no.1 was an employee of defendant no.6, who purchased the suit property by availing housing loan from defendant no.6. It is stated that defendant no.1 had applied for the loan of Rs. 55,000/ vide application dated 29.6.1972. Later on such amount was increased to Rs.60,000/. This housing loan was secured by CS No. 183/2014 Page 19 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 defendant no.1 by depositing of title deeds of the aforesaid residential house. These deeds were to be released to defendant no.1 after adjustment of the aforesaid loan. It is stated that defendant no.1 failed to repay the aforesaid loan due to which defendant no.6 filed a mortgage suit on or about 30.9.1983 with the title UCO Bank Vs. H. P. Rajpal, as suit no. 66 of 1988 in the court of Sh. R. K. Tiwari, Ld. Additional District Judge, Delhi. It is stated that defendant no.6 had already deposited the original sale deed with the said court.
Replication to this written statement was filed. Few facts in respect of the proceedings:
I may like to mention a few facts which are part of the proceedings as under :
1. Defendant No.5 was proceeded exparte vide order dated 09.09.1993.
2. Defendant No.2, 3, 4 & 6 were proceeded exparte vide order dated 27.07.2005.
3. Defendant No.1 had expired during trial and his LRs were impleaded as a defendants vide ordersheet dated 16.05.2005.
4. Defendant No.1(a) Sh. Rakesh Rajpal & his sister defendant No.1(g) Smt. Renu Chhabra had moved an application praying that the remaining LRs may be deleted from the array of parties because defendant No.1 had left a Will in favour of defendant No.1(a) & defendant No. 1(g). However, this application was dismissed vide order sheet dated 22.11.2005.CS No. 183/2014 Page 20 of 65
Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015
5. Presently, only Rakesh Rajpal defendant No.1(a) & Renu Chhabra defendant No.1(g) are contesting this suit. Although Sh. Manoj Kumar, adv. for the remaining LRs of defendant No.1 had appeared on behalf of all the LRs of defendant No.1 and thus they were duly represented but later on none appeared on behalf of remaining LRs of defendant No.1. Therefore, trial proceeded exparte against the remaining LRs though no specific order of proceeding exparte was passed against them.
From the pleadings following issues were framed :
1. Whether the suit is bad for misjoinder of parties? OPD1
2. Whether the suit is within limitation? OPP
3. Whether the agreement dated 2.02.1983 was cancelled to be revoked by defendant No.1? If so, to what effect?
4. Whether the agreement to sell dated 5.09.1984 was a sham transaction and was not to be acted upon by defendant No.1? OPD1
5. Whether defendant No.1 had entered into an agreement to sell dated 21.02.1983 with defendant No.4? If so, to what effect? OPD1.
6. Whether possession had been handed over by defendant No.4 to plaintiff for the purposes of securing the loan allegedly advanced by plaintiff to defendant No.1? If so, to what effect? OPD1
7. Whether the defendant no.1 is entitled to recover possession of the suit property as alleged? OPD1.
8. Whether any agreement had been entered into and acted upon between the parties as alleged in paragraph no.6 and 8 of the plaint? If so, to what effect?
9. To what relief, if any, the plaintiff is entitled?CS No. 183/2014 Page 21 of 65
Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Plaintiff's evidence Plaintiff examined PW1 Sh. Girish Sharma i.e. plaintiff, PW2 Sh. Harbhajan Singh, PW3 Sh. Sham Sunder and PW4 Smt. Saroj Jain. The plaintiff evidence was closed on 25.8.1997. It is pointed out here that PW3 is impleaded as defendant no.2 and PW4 has been impleaded as defendant no.4 in this suit.
Defendants' evidence Defendant no.1 (and his LRs) examined DW1 Sh. Rakesh Kumar, DW2 Smt. Ranu Chhabra, DW3 Sh. P. C. Chhabra and DW4 Smt. Kiran Gandhi and evidence was closed on behalf of defendant no.1 on 18.11.2009. Other defendants did not lead evidence. DW1 is son of defendant no.1. DW2 and DW4 are daughters of defendant no.1. DW3 is husband of defendant no.2.
Contesting Parties Sh. Vinod Sharma, adv. is representing the plaintiff and Sh. Abinash K. Mishra, adv. is representing LR no.1(a) & 1(g) of defendant no.1. The other LRs of defendant no.1 are exparte. Defendant no.2 to 6 are also exparte. Therefore, the contest is between the plaintiff and LR No.1(a) & 1(g) of defendant no.1. Henceforth, whenever I use the expression "Ld. Counsel for CS No. 183/2014 Page 22 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 defendants", it should be construed as Ld. Counsel for defendant no. 1(a) & 1(g).
I have heard the arguments and have considered the rival submissions and my issue wise findings are as under : Issue No.1: Whether the suit is bad for misjoinder of parties?
Onus of proving this issue was upon defendant no.1. It is submitted by Ld. Counsel for defendants that this issue requires no adjudication in view of the fact that during the arguments advanced before this court all the parties have admitted that no relief has been sought against defendants No. 2 to 4. It was argued by Ld. Counsel for defendants that defendants No. 2 to 4 are not the necessary parties in the present suit.
I have considered this submission. The defendant no. 2 to 4 have been proceeded exparte in the present proceedings. But it cannot be said that the suit is bad for misjoinder of parties. It is for the plaintiff to see at the time of filing of the suit as to who are the necessary parties. By impleading defendant no.2 to 4 as defendants, the defendant has not committed any illegality, which may result in dismissal of the suit. Hence, issue is decided against defendant no.1. Now I take up issue no.3 and 5 together, which are reproduced as under :
CS No. 183/2014 Page 23 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Issue No. 3:
Whether the agreement dated 2nd February, 1983 was cancelled to be revoked by defendant No.1? If so, to what effect?
Issue No. 5:
Whether defendant No.1 has entered into another agreement to sell dated 21st February, 1983 with defendant No.4? If so, to what effect?
It is submitted by Ld. Counsel for defendants that Issue Nos. 3 & 5 are in respect of the two separate agreements dated 2.02.1983 and 21.02.1983 executed by the defendant No.1 with defendants No. 2 to
4. It is now not in dispute that both the said agreements dated 2.02.1983 and 21.02.1983 have been cancelled and revoked by defendant No.1 and the said defendants have not initiated any proceedings against defendant No.1 after the withdrawal of the suit No.829/83 and hence it is clear that the these issues can be decided by holding that both the agreements dated 2.02.1983 and 21.02.1983 have been cancelled/terminated and defendants No. 2 to 4 have not got any right whatsoever in their favour in view of the cancellation of the said agreements dated 2.02.1983 and 21.02.1983.
I am in full agreement with these submissions. Both the issues are answered in affirmative. Since both these agreements stand CS No. 183/2014 Page 24 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 cancelled, Defendant no.2 to 4 have no right in the suit property.
Issue No.2: Whether the suit is within limitation?
Ld. Counsel for plaintiff has argued in the present suit that the agreement dated 05.09.1984 was executed during the pendency of the proceedings before the Hon'ble Delhi High Court in C.S.(O.S.) No. 829/83 between the plaintiff and defendants No. 1 to 4 and the copy of the said agreement dated 05.09.1984 was placed on record before Delhi High Court on 10.09.1984 by way of an application bearing I.A. No. 5526 of 1984 (Ex. PW1/1 at pages 1147 to 1149) and on the basis of the said application, the said suit was withdrawn by defendant No.2 on 06.11.1984. Plaintiff has narrated the terms and conditions of the said agreement in para 9 of the plaint. Plaintiff has further contended that he had moved an application for seeking impleadment in earlier suit filed by the bank against defendant no.1 but the said application was dismissed on 10.12.1988. Ld. Counsel for plaintiff has further contended that unless the defendant No. 1 acts as per clause VII of the agreement dated 05.09.1984 by getting the title documents retired from the bank, the cause of action will not accrue in favour of the plaintiff and hence limitation will start running only after getting the copy of the said document/Sale deed retired from the Bank and as the said document was retired only after the CS No. 183/2014 Page 25 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 institution of the present suit, it was argued that the suit was instituted within limitation.
Ld. Counsel for plaintiff has further contended that the earlier suit bearing Suit No. 829 of 1983 was disposed on 06.11.1984 and thereafter they came to know about the intention of defendant No.1 only through the Newspaper Publication dated 20.05.1987 and hence the limitation will start running from 20.05.1987 and thereafter the plaintiff acted by sending the notice dated 20.05.1988 for invoking the Arbitration Clause of the agreement dated 05.09.1984 and thereby the arbitral proceedings were initiated within time.
Ld. Counsel for plaintiff has drawn my attention to the fact that as defendant No.1 had filed OMP No. 56/88 after receiving the notice dated 25.05.1988, the limitation for the institution of the present suit should be treated as having commenced only on 19.03.1990 when the plaintiff came to know during the proceedings in OMP No. 56/88 that defendant No.1 does not want to appoint any common Arbitrator. Thus, it is argued that suit was filed within limitation period on 15.5.1990.
On the other, It is submitted by Ld. Counsel for defendants that the cause of action for the institution of the present suit, if at all there is any, has to be strictly construed as per the Agreement dated CS No. 183/2014 Page 26 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 05.09.1984.
It is further submitted that in para 9 of the plaint the plaintiff has deliberately not quoted the provisions of 'Clause No. VIII' of the agreement dated 05.09.1984 according to which cause of action and limitation for the institution of the present suit should start from 04.01.1985. Clause VIII of agreement is reproduced as under :
"That Sale Deed will be completed within the period of four months from the date of execution of this agreement."
Thus, it is submitted on behalf of defendants that as per Clause VIII of the agreement the cause of action shall start running from 04.01.1985.
Ld. Counsel for defendant has also drawn my attention to Clause VII of agreement, which is reproduced as under :
"Party of the first part shall ensure the title deed from the bank are got retired within two weeks from the date of execution of present agreement. This period, however, may be mutually endorsed by both the parties."
It is argued by Ld. Counsel for defendants that as per the plane reading of the clauses VII & VIII of the agreement, the cause of action to institute the present suit arose after two weeks from the execution CS No. 183/2014 Page 27 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 of the agreement to sell dated 05.09.1984 and in any case not later than the expiry of four months from the date of execution of the agreement dated 05.09.1984 and hence the present suit ought to have been instituted on or before 05.01.1988 which having not been done. Hence, it is argued that the present suit is liable to be dismissed as time barred having been instituted on 15.05.1990.
Ld. Counsel for defendants submits that the plaintiff on the other hand has relied upon the newspaper publication dated 20.05.1987 to show that the cause of action arose only on the publication of notice dated 20.05.1987 and hence the suit having been filed on 15.05.1990 is within three years from the date of accrual of the cause of action on 20.05.1987.
Ld. Counsel for defendants argues that the aforesaid submissions of the plaintiff are unsustainable because limitation shall start running as per Article 54 of the Limitation Act from the date as mentioned in Clause VII and VIII of the agreement dated 05.09.1984 and in any case not later than 5.01.1985. As far as newspaper publication dated 20.05.1987 is concerned, it is submitted that the said Newspaper publication dated 20.05.1987 cannot give any cause of action to the plaintiff because the said notice was meant to withdraw and revoke Special Power of Attorney given to the father of CS No. 183/2014 Page 28 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 plaintiff and in any case the said newspaper publication was consequent to the notices dated 19.01.1987 given by defendant No.1 to plaintiff and L&DO(defendant No.5) and 24.03.1987 given to plaintiff by defendant No.1.
It is further submitted by Ld. Counsel for defendant that pursuant to the letter dated 19.01.1987 given by defendant No.1 to L&DO, a letter dated 13.03.1987 was issued by L&DO to the defendant No.1 whereby the copies of the necessary documents regarding SPA, Agreement to Sell etc. were sought by the L&DO (defendant No.5) from defendant No.1 and which were accordingly provided by defendant No.1 vide letter dated 22.05.1987. From these communications dated 19.01.1987, 13.03.1987 and 22.05.1987 exchanged between the defendant No.1 and L&DO (defendant No.5), it is argued by Ld. Counsel for defendants that the plaintiff or his father had not even informed the facts regarding the execution of the agreement dated 05.09.1984 to the L&DO, much less initiating any process for seeking any permission as claimed in para 14 of the plaint, as late as till 22.05.1987 and even thereafter no steps were taken by plaintiff except sending a notice dated 20.05.1988 as alleged in para no. 18 of the plaint. It is, therefore, argued by Ld. Counsel for defendants that from 05.09.1984 till 20.05.1988, nothing was done by CS No. 183/2014 Page 29 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 the plaintiff rendering the present suit to be time barred.
It is further submitted by Ld. Counsel for defendants that a letter dated 24.03.1987 was also sent by defendant No.1 to the plaintiff in which it was categorically pointed out that not only the amount of Rs. 3,60,000/, as mentioned in the agreement dated 05.09.1984 was agreed to be the repayable loan amount with interest but also that it was also stated that the said agreement was not to be acted upon by the parties. The specific averments made in this regard in para 7 of the written statement of defendant no.1 regarding the letter dated 24.03.1987 and the receipt thereof by the plaintiff has not been denied and rather admitted by the plaintiff while replying to the said para in the replication. On that basis it is alternatively and additionally submitted that the plaintiff was aware about the revocation and cancellation of the agreement and the understanding of defendant No.1 on the basis of said agreement as reflected in the letters dated 19.01.1987 and 24.03.1987 and hence the limitation to institute the present suit ought to be treated as having commenced, even as per the plaintiff, on 19.01.1987 or on 24.3.1987 and hence, it is argued, the present suit having been instituted on 15.05.1990 is beyond the period of limitation.
CS No. 183/2014 Page 30 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 On the claim of the plaintiff regarding the issue of limitation having arisen on 19.03.1990, it is submitted Ld. Counsel for defendants that this date of 19.03.1990 cannot be taken as a date of accrual of the cause of action for the simple reason that OMP No. 56/88 was initiated by defendant no.1 and not by plaintiff and hence the provisions of Section 14 of Limitation Act cannot be pressed into service by the plaintiff in the present proceedings. Ld. Counsel for defendants submits that Ld. Counsel for plaintiff has categorically stated that he is not relying upon the provision Section 14 of the Limitation Act at all and rather, seeking exemption within the meaning of Order VII Rule 6 CPC. On the issue of Order VII Rule 6 CPC Ld. Counsel for defendants submitted that the provisions of order VII Rule 6 CPC will not rescue the case of plaintiff for the simple reason that notice dated 20.05.1988 having been issued after three years from the date of expiry of four months time period from the agreement to sell dated 05.09.1984 shall render the present suit as time barred. Even otherwise, defendant no.1 has referred to the pleadings of OMP no. 56/88 in support of their contention that the accrual of cause of action on the basis of newspaper publication dated 20.05.1987 is nothing but an afterthought which is clear from the fact that no such averment has been taken on the issue of limitation by the CS No. 183/2014 Page 31 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 plaintiff in the OMP proceedings before the Hon'ble Delhi High Court. In any case, it is argued, the said notice dated 20.05.1987, being culmination of the communication starting from 19.1.1987 has to be treated as not the date when the limitation will start running. It is further submitted that even if we assume the case of plaintiff, the limitation shall start running from the date of admitted receipt of letter dated 24.03.1987, which will again render the suit as time barred having been instituted on 15.05.1990.
It is further submitted by Ld. Counsel for defendant that the plaintiff has neither placed on record the copies of the notices dated 20.01.1988 and 20.05.1988 nor the same has been proved/exhibited/relied upon by the plaintiff as per law and hence the contention of the plaintiff on the basis of the notices dated 20.01.1988 and 20.05.1988 have to be rejected by treating the said averments as mala fide averments disentitling the plaintiff to invoke discretionary jurisdiction of this court for seeking specific performance of the agreement dated 05.09.1984 leaving only the date as 20.05.1987 and 19.03.1990 which has been dealt with hereinabove in detail.
It is further argued by Ld. Counsel for defendants that as no proceedings were initiated within three years from 05.09.1984 and CS No. 183/2014 Page 32 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 therefore the suit it time barred even if we treat the unproved Notices dated 20.01.1988 and 20.05.1988 to be the date of initiation of Arbitral Proceedings as the cause of action accrued lastly on 04.01.1985 as per clause VIII of the Agreement dated 05.09.1984.
It is further argued by Ld. Counsel for defendants that as the counsel for plaintiff has given up the arguments under Section 14 of the Limitation Act, it is clear that the benefit of the period from 20.01.1988 or 20.05.1988 till the date of the institution of this suit on 15.05.1990 shall not be available to the plaintiff and hence this suit is liable to be dismissed as barred by time because the plea based on the Newspaper advertisement dated 20.05.1987 has been established as an afterthought having been not even raised in the reply filed by the plaintiff in OMP No. 56 1988, as aforesaid.
This issue had been contested hotly by the parties. Ld. Counsel for defendants has referred to V. M. Salgaocar Vs. Board of Trustees of court of Mor Mugao (2005) 4 SCC 613, State of Punjab & others vs. Gurdev Singh (1991) 4 SCC 1, K.S. Vidyanandam & Ors. vs. Vairavan(1997) 3 SCC 1, Katri Hotels Pvt. Ltd. & Anr. vs. UOI & Anr.(2011) 9 SCC 126 in his support.
I have considered the submission and case law. The arguments of Ld. Counsel for defendant could have carried weight, provided the CS No. 183/2014 Page 33 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 title deeds had been retrieved by the defendant No.1 from the bank. Retrieval of the title deeds from Bank is a very important incident for specific performance of the contract in question. Admittedly, the defendant No.1 had taken loan from defendant No.6 i.e. UCO Bank by mortgaging the suit property and had handed over the title deed of the suit property to defendant No.6. It is also admitted fact that even when the suit was filed, the title deed was with the UCO Bank. UCO Bank had filed a suit against defendant No.1. DW1 Sh. Rakesh Kumar S/o defendant No.1 has admitted in cross examination that his father has taken title deeds of the property in question after making all payments. Ld. Counsel for defendant admits that the mortgage suit filed by the UCO Bank against defendant No.1 was finalised and documents were taken by defendant No.1 after filing of the present suit. I may refer to the WS of UCO Bank (defendant No.6) who stated that defendant No.1 has purchased the suit property by availing housing loan from defendant No.6 i.e. UCO Bank under the Employees of the Housing Scheme and that the housing loan was secured by defendant No.1 by depositing title deeds of the suit property and that the original title deeds were to be released to defendant No.1 after adjustment of the loan.
CS No. 183/2014 Page 34 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Ld. counsel for defendant is claiming that the suit is barred by limitation forgetting that even if the suit would have been filed within three years from the 4 months of execution of agreement in question, no court could have decreed the said suit, for the simple reason that a property which is already mortgaged with the Bank cannot be transferred nor any sale deed could be executed in respect of the said property. Therefore, the limitation would start from the day when title deed of the suit property is released by the bank to the defendant no.1. Although in the agreement it is stated that the defendant will retrieved the documents within two weeks from the date of execution of the agreement, it does not mean that if the defendant does not retrieve the documents within the said period, the agreement will become null & void. It must not be forgotten that the agreement had in fact been substantially acted upon as defendant No.1 had received all most entire the consideration amount except a small portion of Rs. 10,000/. The plaintiff was already in possession of suit property and the only a small part to be executed was the execution of sale deed by defendant No.1 in favour of plaintiff and payment of balance consideration amount of Rs. 10,000/ by plaintiff for defendant No.1. If defendant No.1 failed to retrieve the title deeds, the fault cannot be found with the plaintiff. Plaintiff's period of limitation will start from CS No. 183/2014 Page 35 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 the day when the defendant retrieved the documents from the bank. Therefore, the Clause No. VIII of agreement that sale deed would be executed within 4 months of the date of agreement should be read as "within the period of 4 months from retrieval of title deeds from the Bank" because no sale deed would be executed without retrieval of the title deeds. I may mention here that the time is not the essence of the agreement. But this aspect would be considered by me in the later part of the judgement. Therefore, in a way it is a suit which was filed at a premature stage.
However, filing suit at a premature stage is always an irregularity which in the present case gets cured on account of non raising of the objection by the defendant No.1 about suit having been filed at premature stage and secondly the defendant No.1 had actually retrieved the document from the Bank (defendant no.6) during the trial thus giving a right to the plaintiff to get the agreement executed through the court. Here, I would like to refer to Vithalbhai Pvt. Ltd., Appellant v. Union of India, Respondent AIR 2005 Supreme Court 1891 in which Hon'ble Supreme Court of India held that a suit based on a plaint, which discloses a cause of action is not necessarily to be dismissed on trial solely because it was premature on the date of institution, if by the time written statement came to CS No. 183/2014 Page 36 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 be filed or by the time court is called upon to pass a decree, plaintiff is found entitled to the relief prayed for. Thus, I decide issue no.2 in favour of plaintiff and against the defendants. Issue No.6:
Whether possession had been handed over by defendant No.4 to plaintiff for the purposes of securing the loan allegedly advanced by plaintiff to defendant no.1? If so, to what effect? OPD1 Onus of proving this issue was upon defendant no.1. It is submitted by Ld. Counsel for defendants that plaintiff has contended in the suit that he has been in possession of the suit property as tenant of defendant no.1 and hence the plaintiff has claimed that defendant no.1 has given possession of the suit property to the plaintiff. On the other hand, defendant no.1 has stated in the written statement of this case and also in the written statement dated 10.08.1983 in Suit No. 829 of 1983 that defendant no.1 had given possession of the suit property to the defendant no.4 on 10.05.1983 and thereafter plaintiff was illegally put into possession of the suit property by defendant no.4 who was given possession by defendant no.1 after the execution of agreement dated 21.02.1983. It is submitted by Ld. Counsel for defendants that the averments of the defendant no.1 is established from the deposition of PW4 (defendant no.4 in the present suit) who has admitted during her cross examination on 28.08.1997 that she CS No. 183/2014 Page 37 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 was in possession of one room. In addition, she has also admitted her reply dated 30.05.1984 Ex. PW4/1 filed in suit no. 829/1983 during her crossexamination, which contains the admission of defendant no. 4 Smt. Saroj Jain that she was having the physical possession of the entire suit property even on 30.05.1984 and hence it is argued that defendant no.4 was having the exclusive possession of the entire property till at least 30.05.1984 and hence the contention of the plaintiff cannot be accepted that he was put into possession by defendant no.1 because it has nowhere come in evidence that defendant no.4 had handed over or returned the possession of suit property to defendant no.1 at any point of time prior to the execution of the agreement dated 05.09.1984. It is argued by Ld. Counsel for defendants that possession of the suit property was illegally given to plaintiff by defendant no.4 (PW4) and not by defendant no.1. Ld. Counsel for defendants has drawn my attention to Agreement dated 05.09.1984, which gives the address of Arbitrator, who is father of plaintiff, as X94, West Patel Nagar, New Delhi whereas in SPA dated 20.09.1984 the address of Arbitrator has been given as that of suit property and hence it is argued that the description of the address of the plaintiff in agreement dated 05.09.1984 is false and the plaintiff and his father had illegally taken the possession of the suit property CS No. 183/2014 Page 38 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 after 05.09.1984. It is further argued that the possession over the suit property was illegally given to the plaintiff by defendant no.4 and hence defendant no.1 is entitled to have the possession of the entire suit property as claimed by him in counter claim.
I have perused the evidence and submissions of Ld. Counsel for defendants on this point. Plaintiff examined Smt. Saroj Jain (defendant no.4 herein) as PW4. She testified that defendant no.1 had entered into an agreement to sell in respect of the suit property with her, but possession of the property was not handed over to her because plaintiff was already a tenant in the same. She testified that matter was subsequently compromised between her and defendant no.1 as well as defendants no. 2 & 3 vide which it was agreed that the property may be left with plaintiff. In cross examination by Ld. Counsel for defendant no.1 she denied that she was in possession of the suit property in the year 1983. While deying the suggession that she has handed over the possession of the premises on 10.05.1983, she stated that she alongwith her family had stayed in one room of the suit property for about a month and that she gave possession of the room to the plaintiff Sh. Girish Sharma. In cross examination, PW1 stated that he came to reside in the suit property in February, 1983. PW2 Harbhajan Singh also testified that plaintiff was living in the suit CS No. 183/2014 Page 39 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 property since 1983 as a tenant. I may point out that this witness is also a resident of West Patel Nagar where the suit property is situated. In cross examination PW2 further stated that Saroj Jain (defendant no.4) came to reside in the property in the year 1984 but he denied the suggestion that Saroj Jain has handed over the possession of the portion to the plaintiff because plaintiff was residing in the suit property since the year 1983. PW3 Sham Sunder (who is defendant no.2) in the present case has testified that later on he came to know plaintiff was in possession of the suit property as tenant. However, this being heresay evidence, is not taken in account.
Thus there are two versions. One is that of plaintiff who states that he was already a tenant in the suit property and was in possession of it and this is also supported by Clause V of the agreement to sell dated 5.9.1984. The second version is that of defendant no.1. As per his WS as well as the defendant's witnesses, the possession of the property was handed over to Smt. Saroj Jain (defendant no.4). It is argued by Ld. Counsel for defendants that PW4 illegally gave the possession of the suit property to the plaintiff and accordingly the defendant is entitled to recovery of possession of the suit property also. Ld. Counsel for defendants has tried to support his view from reply Ex. PW4/1 filed by Smt. Saroj Jain in response to CS No. 183/2014 Page 40 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 IA No. 5394/1983 which was moved in suit no. 829/1983. In para 5 she has stated that she was in exclusive physical possession of the suit property. It is submitted that this reply dated 30.05.1984 Ex. PW4/1 by Smt. Saroj Jain shows that she was having the physical possession of the suit property even on 30.05.1984.
As against this submission, Ld. Counsel for the plaintiff has drawn my attention to Clause V which mentions "that party of the fourth part is already in possession of the property as a tenant at a monthly rent of Rs. 550/ per month under party of first part".
I am of the opinion that it is not in dispute that this agreement has been signed by defendant No.1 who was the party of first part as well as by the plaintiff who is the party of fourth part in the agreement. I may point out that recitals of this agreement are not disputed. Defendant No.1 is an educated person and as reflected from the WS of defendant No.6 UCO Bank, he was an employee of the said bank from 1945 to 1979. Therefore, he knew what he was writing in the agreement. The recitals in this agreement to sell has to be given weightage over the aforesaid reply of Smt. Saroj Jain because the reply had been signed only by Smt. Saroj Jain whereas the agreement to sell has been signed by plaintiff and defendant No.1 as well as by Smt. Saroj Jain (defendant no.4). Therefore, it stands proved that CS No. 183/2014 Page 41 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 plaintiff no.1 was already in physical possession of the suit property as on 5.9.1984 and by virtue of this agreement and by acceptance of Rs. 3,50,000/ by defendant no.1 out of Rs. 3,60,000/, the parties had substantially acted upon the agreement to sell. Therefore, it can be said that possession was not handed over by defendant no.4 to the plaintiff. Rather plaintiff was already in possession of the suit property, when the agreement to sell dated 5.9.1984 was executed by plaintiff & defendant no.1. Accordingly, issue no.6 is decided against the defendant no.1 and in favour of plaintiff.
Issue No.4:
Whether the agreement to sell dated 05.09.1984 was a sham transaction and was not to be acted upon by defendant no.1?
Onus to prove this issue was upon defendant no.1. It is submitted by Ld. Counsel for defendants that the following facts show that the intention of the parties was not to treat this document as Agreement to Sell but the said document was to secure the loan amount:
a. Admittedly, the said agreement was executed on 05.09.1984.
b. That defendant no.1 had sent the copy of letter dated 19.01.1987 Ex.DW1/8 to defendant no.5 (L&DO) informing that defendant no.1 had revoked his SPA in favour of Sh. Rameshwar Sharma.CS No. 183/2014 Page 42 of 65
Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 c. That defendant no.1 had sent the copy of the letter dated 19.01.1987 (Ex. DW1/13) to Arbitrator.
d. That defendant no.5(L&DO) had sent the copy of the letter dated 13.03.1987 (Ex.DW1/14) to the defendant no.1 asking him to furnish the copies of the GPA and Cancellation of GPA. It is argued that as on 13.03.1987 plaintiff or his father did not even provide the copies of the GPA to L&DO and hence it is clear that till as late as on 13.03.1987 no steps were taken by plaintiff or his father for execute and pursue the remedy as per agreement dated 05.09.1984 which would have been definitely done in case the said document been treated as a genuine transaction.
e. That defendant no.1 had sent the copy of letter dated 24.03.1987 (Ex. DW1/11) to the plaintiff for asking possession and also for the return of the loan amount of Rs. 3,50,000/. Admittedly there is no response to this letter by the plaintiff despite the fact that the receipt of this letter has been admitted by the plaintiff in para 7 of his replication in response to the specific averments made in para 7 of the written statement. It argued that the receipt of this letters dated 19.01.1987 and 24.03.1987 have not even been denied by the plaintiff during cross examination. It is therefore, clear that the receipt of the letters dated 19.01.1987 and 23.3.1987 by the plaintiff and his father from defendant no.1is established and once it is established, it becomes a clear case to hold that the agreement dated 05.09.1984 reflected a sham transaction and that the same was not be acted upon by the defendant no.1 more so when no contrary suggestion has been put to defendant's witnesses on the contents of the said letters dated 19.01.1987 and 24.03.1987.
CS No. 183/2014 Page 43 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 f. That no action was taken by the plaintiff since 05.09.1984 till 20.05.1988 when a notice was stated to have been issued by the plaintiff resulting into the commencement of the Arbitral proceedings as per clause XI of the Agreement dated 05.09.1984. Now the period of non taking any action by the plaintiff has to be stretched since 05.09.1984 till 14/15.05.1990 in view of the fact that the Ld. Counsel for the plaintiff has given up his arguments under Section 14 of the Limitation Act. g. That from the contents of the Agreement dated 02.02.1983 (Ex.DW1/6), it is clear that the same suit property was valued at Rs. 5,00,000/ as on 02.02.1983 and hence had the agreement dated 05.09.1984 been a genuine transaction, the same suit property would not have been sold for Rs. 3,60,000/.
h. That if we see Agreement dated 02.02.1983(Ex. DW1/6), it is clear the same is titled as Agreement to Sell and Purchase whereas if we see the Agreement dated 05.09.1984 it is titled as Agreement only.
i. That without any prejudice to the above, it is submitted that the agreement dated 05.09.1984 was executed under pressure and also by way of fraud the plaintiff has deliberately misled the defendant no.1 by incorrectly giving two names of Rameshwar Sharma and Rameshwar Dayal with different addresses whereas the fact remains that both the persons were found to be one person only. j. That had the transaction dated 05.08.1984 been genuine transaction, the plaintiff would have proved the Notices dated 20.01.1988 and 20.05.1988 also as per the law and as the same was not done, it is clear that they were also proceeding with the understanding that the agreement dated 05.09.1984 was not to be acted upon.
CS No. 183/2014 Page 44 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 k. That the written statement of defendant Nos. 2 to 4 dated 25.05.1992 shows that the defendant Nos. 2 to 4 and plaintiff had colluded to get the Agreement dated 05.09.1984 for securing loan of plaintiff and thereafter claiming that the price of the suit property has fallen down and hence they did not want to purchase the suit property. Nowhere the evidence has been led that the cost of the suit property had fallen down since February, 1983 to September, 1984.
l. That had the transaction dated 05.09.1984 been a genuine transaction, the application filed in Suit No. 829 of 1983 ought to have been filed under Order 23 Rule 3 CPC and not under Order 23 Rule 1 CPC.
m. Defendant no.1 has further contended and argued that agreement dated 05.09.1984 was destroyed after execution and precisely due to this fact the plaintiff has admitted that the original copy of the agreement is not available/traceable. In view of the fact that the defendant no.1 had claimed that the agreement dated 05.09.1984 was destroyed as the same was not to be acted upon, the plaintiff was bound to file an application for leading secondary evidence to prove the circumstances rendering the agreement dated 05.09.1984 as untraceable.
I have considered the submissions of Ld. Counsels for parties. The above mentioned submissions of Ld. Counsel for defendants are to be considered in view of the backdrop of the written statement and the evidence led by defendant no.1. In written statement, defendant no.1 has stated that he was in financial crisis and taking undue CS No. 183/2014 Page 45 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 advantage of this situation of defendant no.1, plaintiff had advanced a loan of Rs.3,60,000/ to defendant no.1 but he compelled defendant no.1 to execute the agreement to sell in question with an understanding that it will serve the purpose of security to the loan. It is argued by Ld. Counsel for defendant that the agreement in question is not the true reflection of intentions and understanding of the parties, which prevailed at the time of execution of the documents.
First, I take up the evidence of DW1 Rakesh Rajpal (Defendant no.1(a) herein). This witness is son of defendant no.1. Major portion of his evidence was recorded when defendant no.1 was still alive. I may point out that plaintiff's evidence was closed vide order sheet dated 28.8.1997. The affidavit of DW1 Rakesh Kumar was filed on 11.9.2006. It is pertinent to note that defendant no.1 was not examined as the defence witness. Although in his cross examination DW1 Rakesh Kumar has stated that defendant no.1 was confined to bed but nothing prevented the defendants to examine him on commission. He was the best person to testify as to what were the circumstances in which the agreement in question was executed and what was the understanding between the parties.
The version of DW1 in cross examination dated 27.3.2003 that defendant no.1 was bed ridden is not worthy of reliance because as CS No. 183/2014 Page 46 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 per the testimony of DW2 Smt. Renu Chhabra (cross examination dated 11.9.2006 and 21.11.2006), defendant no.1 had expired on 12.9.2004 and that he developed some problems/ailments one week prior to his death and that he fell down and suffered displacement of pelvic bone. Thus, it is clear when DW1 was testifying and prior to that, defendant no.1 was in capacity to testify.
In absence of the testimony of defendant no.1, the evidence of other witnesses examined by defendants loses much evidentiary value. So far as DW1 is concerned, he does not appear to be an eye witness because in his cross examination dated 5.6.2004 he states that his father told him that it was a loan amount. Therefore the testimony of DW1 in respect of the agreement to sell in question is only a hearsay.
Now I take up the testimony of Smt. Renu Chhabra (DW1). She is the daughter of defendant no.1. From her testimony, it is not clear as to whether she had witnessed the execution of the agreement or not. However, her husband Sh. P. C. Chhabra in his cross examination dated 24.9.2008 had testified that he was present when the agreement to sell dated 5.9.1984 was executed by defendant no.1 in favour of Girish Sharma, which was written at the house of H. P. Rajpal i.e. defendant no.1. He further admits in this cross examination that it was agreed between Late Sh. H. P. Rajpal and CS No. 183/2014 Page 47 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Girish Sharma and the property was agreed to be purchased for the consideration of amount of Rs.3,60,000/. This admission in cross examination leaves me in no doubt that it was not a loan agreement as argued by Ld. Counsel for defendants. Rather it was a duly executed agreement to sell the property. Ms Kiran Gandhi (DW4) has also not testified as to whether she was eye witness to the agreement to sell dated 5.9.1984. Although I was not required to discuss all this in view of Section 91 & 92 of Indian Evidence Act but as an abundant caution, I have looked into the question as to what was the intentions between the parties in reaching the agreement in question. Here, I will refer to the letter Ex.DW1/8 dated 19.1.1987 written by defendant no.1 to L&DO in which he has clearly stated that he had entered into an agreement to sell with plaintiff. This further proves that the agreement was not a loan agreement, rather it was an agreement to sell. The onus of the issue was upon the defendant no. 1, which he miserably failed to prove. Accordingly, the issue is decided against the defendants and in favour of plaintiff.
Ld. Counsel for defendants has tried to show that plaintiff did not act despite cancellation of Special Power of Attorney by defendant no.1 in favour of plaintiff's father whereby he was authorized to execute sale deed on behalf of defendant no.1. I am of the opinion CS No. 183/2014 Page 48 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 that cancellation of of Special Power of Attorney in favour of father of plaintiff only means that father of plaintiff was prevented from acting as the attorney of defendant no.1. No other meanings cannot be drawn from this fact. By cancellation of this Power of Attorney, defendant no.1 still remains under an obligation to execute the sale deed. My attention is drawn to the fact that earlier agreement to sell dated 2.2.1983 with defendant no.2 & 3 (Ex.DW1/6) in respect of the suit property was for a consideration of Rs.5 lacs and that the agreement in question dated 5.9.1984 values the suit property at a lower rate for Rs.3,60,000/. It is argued that in Delhi, the value of the property had not decreased rather it had increased. The fact that the property is being sold at a lesser rate is a evidence of the document being a sham document.
I have considered this plea and I am of the opinion that defendant no.1 was under financial distress, he was to repay the loan to UCO Bank. His title deeds were with UCO Bank and suit property was also mortgaged with them. In such a situation he was entering into agreements to sell one after other. These circumstances appear to have led him to enter into an agreement to sell at a lower rate. This type of contract do not become invalid. A contract will become void if it is not executed with free consent which is devoid of coercion, undue CS No. 183/2014 Page 49 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 influence, fraud, misrepresentation and mistake (under Section 15 to 20 of Indian Contract Act 1972). The defendant no.1 has not proved any of these facts, which may bring the agreement to sell dated 5.9.1984 under the sway of any such taint. Accordingly this issue no. 4 is decided against the defendant no.1.
Issue No.8:
Whether any agreement had been entered into an acted upon between the parties as alleged in para no.6 and 8 of the plaint? If so, to what effect?
In issue no.6 I have already held that the agreement in question was not only entered into between the parties but was also substantially acted upon. Para no.6 of the plaint is in respect of agreement to sell dated 02.02.1983 is in respect of the pleading of defendant No.1 in suit no. 829/1983 in which it is stated that the agreement to sell dated 02.02.1983 had been cancelled and defendant no. 1 executed another agreement to sell in favour of defendant No.4. This is an admitted fact and is not in dispute.
Para no. 8 of the plaint is in respect of an application bearing no. IA 5526/1984 in suit no. 829/1983 under Order 23 Rule 3 CPC for recording of compromise between the parties, in which it was stated that defendant No. 1 to 4 had settled their disputes and also agreed CS No. 183/2014 Page 50 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 that defendant No.1 shall sell the property in dispute to plaintiff, agreement to such an effect has already been executed by defendant no.1 in favour of plaintiff. This fact is also not in dispute as I have already discussed the agreement to sell had also been acted upon by the parties substantially. However, Ld. Counsel for defendants has raised further issues.
It is submitted by Ld. Counsel for defendant No.1 that before proceeding with the present issue, it will have to be understood as to why this issue was framed over and above Issue No.4 and in this regard it is relevant to point out that para 6 of the plaint refers to Agreement dated 02.02.1983 and para 7 refers to Agreement dated
05.09.1984 and para 8 refers to the fact that the Application(I.A. No. 5526 of 1984) was filed in Suit No. 829 of 1983 and hence the reference to paras 6 & 8 makes it clear that the said issue was framed only because the plaintiff had mentioned in para 8 of the plaint that the said application was filed in Suit No. 829/83 under Order 23 Rule 3 CPC and herein lies the importance of the difference in Order 23 Rule 1 and Order 23 Rule 3 CPC which renders the present suit as not only be barred as per the provisions contained in Order 23 Rule 1(4) read with Order 1 Rule 2 CPC but also that the use of the provisions of Order 23 Rule 3 CPC in para 8 of the plaint further proves that the CS No. 183/2014 Page 51 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 agreement dated 05.09.1984 was never ever intended to be acted upon by the parties as had it been the case the application ought to have been filed in Suit No. 829/1983 under Order 23 Rule 3 CPC.
Ld. Counsel for defendants has also drawn my attention to WS of the defendant No.1, who contended that OMP No. 56/88 was initiated against the notice dated 20.05.88 issued by defendant no.1. The Arbitral proceedings were initiated vide notice dated 20.05.88 can be said to be the proceeding having been initiated by plaintiff on the same cause of action for seeking the same relief against the same party for the same suit property and on that basis it is submitted on behalf of defendants that the provision of sub rule(4) Rule 1 of Order XXIII bars the present suit because as per the said provision the plaintiff herein is precluded from instituting the present suit in view of his admitted failure to seek liberty from the earlier proceedings in terms of provision contained in Order 2 Rule 2 CPC read with Order XXIII Rule1(4). Hence, the present suit cannot be held to maintainable.
It is argued by Ld. Counsel for defendants that as the present suit is a second proceeding, it could not have been instituted without seeking liberty under Order 2 Rule 2 read with Order 23 Rule 1(4) CPC as the earlier proceedings have been abandoned by the plaintiff CS No. 183/2014 Page 52 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 which is clear from the fact that there is nothing on record to even indicate as to how that earlier arbitral proceedings came to an end/abandoned or whether any liberty was given by the Arbitral Tribunal to the plaintiff for institution of the present subsequent proceedings and in this regard it is submitted that the OMP No. 56 of 1988 did not terminate the mandate of the Arbitral Tribunal as during the pendency of the said proceedings, the present proceeding was instituted. It is, therefore, argued by Ld. Counsel for defendants that as plaintiff has not taken any liberty of the Arbitral Tribunal for the institution of the present suit, he is precluded from the institution of present suit because it is admitted fact that the parties, suit property, cause of action and the disputes raised in the previous arbitral proceedings were exactly the same as in the present proceedings.
I have carefully considered the submissions of Ld. Defence Counsel and I am of the opinion that a hyper technical approach has been taken by Ld. Counsel for defendants. I fully agree with him that the parties to suit no.829/83 moved an application under Order 23 Rule 1 CPC, which is Ex.PW1/1 (also Ex.DW1/4). Vide this application, it was stated by the parties to the said suit that matter has been settled between the parties and an agreement has been reached and accordingly it was prayed that plaintiff may be allowed to CS No. 183/2014 Page 53 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 withdraw the suit. It is an admitted fact that plaintiff was not a party to that suit. Therefore, it does not make any difference to the plaintiff as to whether the suit was withdrawn under Order 23 Rule 1 CPC or it was withdrawn under Order 23 Rule 3 CPC. The plaintiff herein is only concerned with his agreement to sell and not with the proceedings of the said case. The relevant fact is that plaintiff was a party to the agreement to sell only and not to the said litigation. The technical difference between Order 23 Rule 1 and Order 23 Rule 3 of CPC cannot be stretched to mean that parties did not intend to act upon the agreement.
So far as the question of pendency of claim of plaintiff before the arbitrator is concerned, I find no substance in it because it was defendant no.1, who challenged the appointment of arbitrator on the ground that plaintiff had concealed the fact that the arbitrator was the father of plaintiff, therefore it was prayed in OMP 56/88 by defendant no.1 that Rameshwar Sharma, the father of plaintiff herein should be restrained to act as arbitrator and the arbitration agreement should be declared null and void. It is not in dispute that the named arbitrator was the father of plaintiff. The fate of the arbitration clause was thus clear to the plaintiff in face of the OMP No. 56/88 filed by defendant no.1. It is admitted case that Hon'ble High Court of Delhi restrained CS No. 183/2014 Page 54 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Sh. Rameshwar Sharma to act as arbitrator and that parties could not agree to a new arbitrator. These were the circumstances which terminated the mandate of the arbitrator to hold arbitration. Thus the office/court of the arbitrator stood disbanded on account of the aforesaid circumstances. It was a situation where there was no occasion for plaintiff to seek permission to withdraw his claim from the arbitrator, as his office did not exist. Accordingly, the plaintiff rightly filed the present suit without seeking permission from the arbitrator to file a fresh suit on the same cause of action on which the claim was filed by him before the arbitrator. Accordingly, issue no.8 is decided in favour of plaintiff and against defendants. Issue no. 7 Whether the defendant no.1 is entitled to recovery possession of the suit property as alleged? OPD1 Since I have already discussed that agreement to sell is a valid document and the suit property was already in possession of the plaintiff and that defendant no.1 has received almost entire consideration amount from plaintiff at the time of agreement, Iam of the considered opinion that defendant no.1 is not entitled to recovery of the suit property as prayed for in the counter claim. Of course defendant had also not paid the requisite court fee for relief of possession of suit property as claimed in counter claim. Therefore the CS No. 183/2014 Page 55 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 counter claim of defendant no.1 is hereby dismissed. The issue is also decided against the defendant.
Issue No.9:
To what relief, if any, the plaintiff is entitled?
It is argued by Ld. Counsel for defendants that time was the essence of the agreement to sell in question. If the title deed is not retrieved from the Bank within 2 weeks by defendant no.1 and sale deed is not executed by defendant no.1 within 4 months as agreed, the plaintiff can only ask for compensation and not for specific relief of contract.
Ld. Counsel for defendants has referred to K. S. Vidyanadan and others Vs. Vairvan in (1997) 3 SCC 1, in which Hon'ble Supreme Court of India, after considering the Constitution Bench judgment in Chand Rani Vs. Kamla Rani (1993) 1 SCC 519 the following observations were made in para 10 of the judgment at page no.7 of (1997)3 SCC 1:
"...In other words the Court should look at all the relevant circumstances including the timelimit(s) specified in the agreement and determine whether its discretion to grant specific performance should be exercised. Now in the case of urban properties in India it is well known that their prices have been going up sharply over the last few decades CS No. 183/2014 Page 56 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 particularly after 1973. In this case, the suit property is the house property situated in Madurai, which is one of the major cities of Tamil Nadu. The suit agreement was in December 1978 and the six months period specified therein for completing the sale expired with 15th of June, 1979. The suit notice was issued by the plaintiff only on 11.07.1981 i.e. more than two years after the expiry of six months period. The question is what was the plaintiff doing in this interval of more than two years? The plaintiff says that he has been calling upon defendants 1 to 3 to get the tenant vacated and execute the sale deed and that the defendants were postponing the same representing that the tenant is not vacating the building. The defendants have denied this story. According to them, the plaintiff never moved in the matter and never called upon them to execute the sale deed. The Trial Court has accepted the defendants story whereas the High Court has accepted the plaintiffs story. Let us first consider whose story is more probable and acceptable. For this purpose, we may first turn to the terms of the agreement. In the agreement of sale, there is no reference to the existence of any tenant in the building. What it says is that within the period of six months. The plaintiff should purchase the stamp papers and pay the balance consideration whereupon the defendants will execute the sale deed and that CS No. 183/2014 Page 57 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 prior to the registration of the sale deed, the defendants shall vacate and deliver possession of the suit house to the plaintiff. There is not a single letter or notice from the plaintiff to the defendants calling upon them to get the tenant vacated and get the sale deed executed until he issued the suit notice on 11.07.1981. It is not the plaintiff's case that within six months, he purchased the stamp papers and offered to pay the balance consideration. Defendant's case is that the tenant is their own relation, that he is ready to vacate at any point of time and that the very fact that the plaintiff has in his suit notice offered to purchase the house with the tenant itself shows that the story put forward by him is false. The tenant has been examined by the defendant as DW2. He stated that soon after the agreement, he was searching for a house but could not secure one. Meanwhile (i.e. on the expiry of six months from the date of agreement), he stated, the defendants told him that since the plaintiff has abandoned the agreement, he need not vacate. It is equally an admitted fact that between December 15, 1978 and July 11,1981, the plaintiff has purchased two other properties. The defendants consistent refrain has been the prices of house properties in Madurai have been rising fast, that within the said interval of 2 ½ years, the prices went up by three times and that only because of the said circumstance has the plaintiff (who had CS No. 183/2014 Page 58 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 earlier abandoned any idea of going forward with the purchase of the suit property) turned round and demanded specific performance. Having regard to the above circumstances and the oral evidence of the parties, we are inclined to accept the case put forward by defendants 1 to 3. We reject the story put forward by the plaintiff that during the said period of 2 ½ years, he has been repeatedly asking the defendants to get the tenant vacated and execute the sale deed and that they were asking for time on the ground that tenant was not vacating. The above finding means that from 15.12.1978 till 11.07.1981 i.e. for a period of more than 2 ½ years the plaintiff was sitting quiet without taking any steps to perform his part of the contract under the agreement though the agreement specified a period of six months within which he was expected to purchase stamp papers, tender the balance amount and call upon the defendants to execute the sale deed and deliver possession of the property. We are inclined to accept the defendant's case that the values of the house property in Madurai town was rising fast and this must have induced the plaintiff to wake up after 21/2 years and demand specific performance.
Sri Sivasubramanium cited the decision of the Madras High Court in S.V. Sankaraninga Nadar v. P.T.S. Ratnaswamy Nadar. AIR 1952 Mad 389 holding that mere rise in prices is no CS No. 183/2014 Page 59 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 ground for denying the specific performance. With great respect, we are unable to agree if the said decision is understood as saying that the said factor is not at all to be taken into account while exercising the discretion vested in the Court by law. We cannot be oblivious to the reality and the reality is constant and continuous rise in the values of urban properties - fuelled by larger scale migration of people from rural areas to urban centres and by inflation. Take this very case. The plaintiff had priced to pay the balance consideration, purchase the papers and ask for the execution of sale deed and delivery of possession within six months. He did nothing of the sort. The agreement expressly provides that if the plaintiff fails in performing his part of the contract, the defendants are entitled to forfeit the earnest money of Rs. 5,000/ and that if the defendants fail to perform their part of the contract, they are liable to pay double the said amount. Except paying the small amount of Rs. 5,000/(as against the total consideration of Rs. 60,000/) the plaintiff did nothing until he issued the suit notice 2 ½ years after the agreement. Indeed, we are inclined to think that the rigor of the rule evolved by Courts that time is not of the essence of the contract in the case of immovable properties evolved in times when prices and values were stable and inflation was unknown - requires to be relaxed. If not CS No. 183/2014 Page 60 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 modified, particularly in the case of urban immovable properties. It is high time, we do so. Ld. Counsel for the plaintiff says that when the parties entered into the contract, they knew that prices are rising: hence, he says, rise in prices cannot be a ground for denying specific performance. May be, the parties knew of the said circumstance but they have also specified six months as the period within which the transaction should be completed. The said time limit may not amount to making time the essence of the contract but it must yet have some meaning. Not for nothing could such time limit would have been prescribed. Can it be stated as a rule of law or rule of prudence that where time is not made the essence of the contract, all stipulations of time provided in the contract have no significance or meaning or that they are as good as nonexistent? All this only means that while exercising its discretion, the Court should also bear in mind that when the parties prescribe certain timelimit(s) for taking steps by one or the other party it must have some significance and that the said time limit(s) cannot be ignored altogether on the ground that time has not been made the essence of the contract (relating to immovable properties).
...............................................In the case before us, it is not mere delay. It is a case of total inaction on the part of the plaintiff for 2 CS No. 183/2014 Page 61 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 & ½ years in clear violation of the term of agreement which required him to pay the balance, purchase the stamp papers and then ask for execution of sale deed within six months. Further, the delay is coupled with substantial rise in prices according to the defendants, three times - between the date of agreement and the date of suit notice. The delay has brought about a situation where it would be inequitable to give the relief of specific performance to the plaintiff."
It is argued by Ld. Counsel for defendants that in the present case also, as per the contents of para 6 of the Written statement of defendant nos. 2 to 4 at page 769 of the TCR, it is clear (as per the said defendants) that the price of the suit property at Rs. 5 lakhs was on a higher side and hence they decided not to proceed with the purchase of the suit property and hence it is clear that the act of the plaintiff in instituting the suit in the month of May 1990 (i.e. after 6 years from the date of the agreement dated 05.09.1984) disentitles him from the benefit of the exercise of the discretionary jurisdiction of this Hon'ble Court for specific performance of the said agreement as the same would be "inequitable in law".
I have considered the submissions of Ld. Defence Counsel and I agree that this is a discretionary power of the court to order specific CS No. 183/2014 Page 62 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 performance. However, in the present case, the equities are in favour of plaintiff. Plaintiff had given almost entire amount to the defendant no.1 on the date of agreement and was already in possession of the suit property. Perusal of the case law cited by Ld. Counsel for defendants would show that the court has to see carefully as to whether the equities are in favour of plaintiff or defendants. By the aforesaid judgement, Hon'ble Supreme Court of India did relax, in case of urban properties, the rigor of the rule that the time is not the essence of the contract in respect of immovable properties. But it has not been modified. It is true that the property in dispute before this court is also situated in Delhi and its price must have increased astronomically. But it must not be forgotten that where the purchaser had paid almost entire consideration, as in the present case, and is also in possession of the property, equities will favour the plaintiff and not the defendants. In the case law cited by Ld. Counsel for defendants, the defendants had agreed to sell the suit house to plaintiff for a consideration of Rs.60,000/, out of which only a sum of Rs.5000/ had been paid as advance amount by the plaintiff to defendants and the agreement was to be executed within 6 months. Thus in the case law cited by Ld. Counsel for defendants, plaintiff had paid a very small portion of the total consideration and he was also CS No. 183/2014 Page 63 of 65 Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 not in possession of the suit property and had filed the suit after two and half years. In such circumstances, Hon'ble Supreme Court held that time was the essence of the said contract and the equities were not in favour of the plaintiff.
However, in the present case, the precondition for execution of the sale deed is retrieval of the title documents by defendant no.1 from UCO Bank. As per agreement, the same were required to be retrieved within 2 weeks by defendant. In view of this obligation upon defendant no.1, it appears that parties had agreed to execute the sale deed within 4 months of the date of agreement i.e. 5.9.1984. But fact shows that defendant no.1 did not take any steps to retrieve the said documents and the same were retrieved only during the pendency of the present suit. Therefore, plaintiff cannot be made to suffer on account of lapse of time as agreed in the agreement to sell because the same happened due to inaction of defendant no.1 and not because of inaction of the plaintiff. Consequently, the plea of time being essence of contract cannot be accepted.
Since all the issues have been decided in favour of plaintiff and against the defendants and equities also favour the plaintiff, plaintiff's suit is liable to be decreed and counter claim of defendant no.1 is liable to be dismissed.
CS No. 183/2014 Page 64 of 65Girish Sharma Vs. H. P. Rajpal & Ors. Judgement dt. 23.5.2015 Relief In view of above discussions, suit against defendant no.2, 3, 4 and 6 is hereby dismissed as no decree can be issued against them.
The counter claim of the defendant no.1 is also dismissed. However plaintiff's suit against all the LRs of defendant no.1 and specifically against defendant no.1 (a) and (g) is hereby decreed with costs.
Specific Performance of Contract is hereby ordered by the parties. Plaintiff is directed to deposit the remaining amount of Rs. 10,000/ to the LRs of defendant no.1 along with the interest at the rate of 20% per annum w.e.f. 5.9.1984 till decision of this case within 15 days.
The LRs of defendant no.1 are directed to execute sale deed in respect of the suit property in favour of plaintiff.
Land & Development Office (defendant no.5) is directed to grant sale permission as per rules in accordance with law.
Suit is decreed accordingly. Decree sheet be prepared. File be consigned to record room.
Announced in the open court on 23.5.2015.
(Vinod Kumar) Additional District Judge13, (Central), Tis Hazari Courts, Delhi CS No. 183/2014 Page 65 of 65