Bombay High Court
Daza N. Gandhi And Another vs Indira Maruti Varadkar And Another on 17 April, 1990
Equivalent citations: AIR1991BOM51, 1990(2)BOMCR454, (1990)92BOMLR235, AIR 1991 BOMBAY 51, (1990) 3 CURCC 227, (1991) 1 CIVLJ 92, (1990) 2 BOM CR 454, (1990) 92 BOM LR 235
ORDER
1. This Chamber Summons has been taken out by the defendants in the following circumstances.
2. The plaintiffs filed the above suit for specific performance of an agreement dated 6th April 1984 executed between the plaintiffs and the defendants for sale of Flat No. 5, situated on the second floor of the Samarath Nagar Tenants Co-operative Housing Society Ltd., Bombay-22, and for certain other reliefs. The defendants had contested the suit. However, during the pendency of the suit, the parties arrived at consent terms. Accordingly, a consent decree was passed in terms of the consent terms on 21st September 1989. Clause 1 of the consent terms provides for decree in terms of prayers (a) (for declaration that the agreement is valid and subsisting and the defendants are bound and liable to specifically perform the same); (b) (for completing the sale and for delivering vacant possession and for doing all other necessary things for the purpose of completion of the sale); and (f) (for costs). Clause 2 of the consent terms, which is the relevant clause in this Chamber Summons, is as follows:
"2. In the event of the Defendants 1 and 2 paying to the Plaintiffs a sum of Rupees 3,50,000/- (Rupees Three Lakhs Fifty Thousand only) on or before 1st April 1990 (time being of the essence), the decree in terms of prayers (a) and (b) and (f) to be marked satisfied."
The rest of the clauses are not relevant.
3. The Defendants state that for the purpose of compliance with clause 2 of the consent terms, they had to take loan from their friends and relatives. They collected a sum of Rs. l,20,000/-by 31st March 1990 and for payment of the balance sum of Rupees 2,30,000/- they were seeking a loan from a married daughter of the 1st defendant, who, in turn, had to get the same from a bank. The defendants say that the bank had sanctioned the 1oan and they wanted about 30 days time, that is to say, up to 1-5-1990 to pay the balance. It is in these circumstances, they seek an extension of time to pay the said sum of Rs. 3,50,000/-. This Chamber Summons was taken out on or about 2nd April 1990 and they moved the Court first with the request that they be permitted to deposit a sum of Rs. 2,00,000/- by 4th April 1990, as by that time they could collect that much amount, They deposited the said sum of Rs. 2,00,000/-on 4th April 1990. The Chamber Summons was argued on 10th April 1990 and on that day, Mr. Wahvalkar stated that they could arrange the balance of Rs. 1,50,000/ - also and that they were in a position to deposit the amount immediately on the Court passing an order in their favour. Mr. Walwalkar stated further that they could collect the entire amount by 6th April 1990.
4. Mr. Walwalkar submitted that this is a proper case where time should be extended for the purpose of depositing the said sum of Rs. 3,50,000/-. He submitted that if no extension is given, the Defendants would suffer great hardship and prejudice.
5. The plaintiffs objected to this. They would not agree to any persuasion on the part of the Defendants. Hence the Chamber Summons had to be argued.
6. In support of the Chamber Summons, Mr. Walwalkar submitted that the Courts have always given reliefs against forfeiture, even if the decree was a consent decree. In this connection, he drew my attention, firstly, to the case of Jadabendra Nath Mishra v. Smt.Manorama Debya, . Relying on this case, Mr. Walwalkar submitted that if a question of forfeiture arises, the Court has ample power, in an appropriate case, to grant relief against forfeiture even without the consent of the parties. That was a case where the original suit for partition had been decreed ex parte. The petitioner, who was the defendant in the said suit, made an application for setting aside the said ex parte decree. In that, the parties eventually came to a compromise, under which the petitioner was to pay a certain amount within a certain time to have the application allowed and the suit restored to file after setting aside the ex parte decree. There was also a default clause providing, inter alia, that in case the above payment was not made within the specified time, the application for setting aside the decree would stand dismissed and the ex parte decree would stand confirmed. The petitioner did commit default but the Court gave him such relief against forfeiture.
7. Mr. Walawalkar then drew my attention to the case of Mehru v. Mohan Lal, , Here again the principle is the same. There was a decree passed on compromise, a clause of which entitled the decree-holder to recover possession of the land in dispute from the tenant in case of non-payment of the instalments at the stipulated time. The Court held that the petitioner can be relieved of the rigours of the consent decree, if the contract or consent decree passed thereon contairis a forfeiture or penalty clause. The Court did not bother even though the decree was a consent decree, inasmuch as, it was just a contract between the parties, with the seal of the Court superimposed thereon and as such it can be avoided on any ground on which the contract can be avoided under the provisions of the Contract Act. The Court, in the above case, had distinguished the case of the Supreme Court, being the case of Hukum-chand v. Bansilai, and, in fact, had relied on the above Calcutta case in support of its conclusion.
8. In the case of Smt Periyakkal v. Smt. Dakshyani, , the Supreme Court had considered the above case of Hukumchand v. Bansilai (supra) and the Supreme Court distinguished the same, inasmuch as, in the earlier case there was a statutory compulsion to confirm the sale on the dismissal of an application under Order XXI, Rule 90, Code of Civil Procedue and that, therefore, postponment and further postponment of the confirmation of the sale could only be by consent of the parties, whereas in the case before them, there was no such statutory compulsion. In this case, the Supreme Court said as follows (at page 431 of AIR):
"The time for deposit stipulated by the parties became the time allowed by the Court and this gave the Court the jurisdiction to extend time in appropriate cases. Of course, time would not be extended ordinarily, nor for the mere asking. It would be granted in rare cases to prevent manifest injustice. True, the Court would not re-write a contract between the parties but the Court would relieve against a forfeiture clause; and, where the contract of the parties has merged in the order of the Court, the Court's freedom to act to further the ends of justice would surely not stand curtailed. Nothing said in Hukam-chand's case militates against this view."
9. Mr. Mehla did not dispute any of these propositions contained in these cases. He submitted that ordinarily the Court will not interfere in matters of consent decree, unless the Court is required to give a relief against forfeiture. That is the principles in all cases in which the Court had given relief either under S. 148 or under S. 151 of the Code of Civil Procedure. Mr. Wahvatkar, on the other hand, submitted that in a given case if the defendants were to leave their residence with the full amount for the purpose of depositing the same in Court and if due to some mishap or otherwise the defendants were unable to deposit the amount in Court on that day and if the defendants come to the Court on the next day and explain their difficulties, the Court in such cases can exercise its jurisdiction and give relief. He submitted that in any appropriate case, the Court, in the interest of justice, is empowered to give relief, either on the principle involved under S. 148 or under S. 151 of the Code of Procedure.
10. Mr. Mehta drew my attention to the said case of Hukumchand (supra), which has been followed in other cases. He also relied on the case of Hindurao Annasaheb Patil v. Yeshwant Laxrnan Yadav, , wherein, the Court had declined to exercise its jurisdiction, the decree being conditional. He also relied on a judgment given by another single Judge of this Court, being the case of Durga, Mohan Joshi v. International Metal Industries, , wherein the Court held that time for payment as specified in the final money decree cannot be enlarged by resorting to S. 148 of the C.P.C. and in this connection, this Court had construed the said case of Smt. Periyakkal (cited supra) and held that time would be granted in order to prevent manifest injustice and to give relief against forfeiture.
11. I think, on broad principle, it can be said that if the clause concerned is in the nature of a penalty or a forfeiture, the Court is always competent to give relief against it. The test is whether by allowing the decree-holder to enforce the default clause, would he get more than what he deserves? If the Court in its conscience considers that he would unjustly enrich himself by holding on to the default clause, it would interfere, be it a consent decree or otherwise, for example, in the present case, if the decree was for cancellation of the agreement on the defendants paying a certain amount within a certain time, failing which the entire property were to pass on to the plaintiffs, and if the defendants were to apply for extension of time on facts mentioned herein, the Court would not hesitate to grant such a relief. That, in essence, is the meaning of granting relief against forfeiture and penalty. But on the other hand, in the present case the decree itself is one for specific performance and under the decree, the plaintiffs are entitled to get possession of the flat, as they have paid the price for the same. However, the decree provides for a concession, namely, if the defendants pay a sum of Rs. 3,50,000/- by a certain date, the plaintiffs would not insist upon the decree being carried out and they would have the decree marked fully satisfied. In such a case, if the default takes place, the plaintiffs get no more than what they are entitled to get under the decree. There is no question of granting any relief against forfeiture or penalty. In such circumstance, if time has to be extended, it can only be done by consent of both the parties.
12. That being the position, in the present case, the fact that there was difficulty in acquiring the amount or pay the same in this Court by 1-4-1990 or that the defendants could collect the amount within a short time thereafter, would become irrelevant, inasmuch as time cannot be extended without the consent of the other side. In such circumstances, there is no question of application of any provision, either under S. 148 or even under S. 151 of the Code of Civil Procedure.
13. In the result, I pass the following order:
ORDER This Chamber summons is dismissed. The money deposited by the defendants be given back to the defendants. Prothonotary to pay on the minutes of the order.
At this stage, Mr. Naik applies that the execution of the decree be stayed for a period of two weeks from today, as he wants to consider his position Mr. Naphade opposes.
P. C. Execution of the decree is stayed for a period of two weeks from today.
14. Order accordingly.