Andhra Pradesh High Court - Amravati
Bukkapatnam Khalandar Basha vs Basireddy Vijayamma on 1 May, 2020
Author: C.Praveen Kumar
Bench: C.Praveen Kumar, Battu Devanand
THE HON'BLE SRI JUSTICE C. PRAVEEN KUMAR
AND
THE HON'BLE SRI JUSTICE BATTU DEVANAND
A.S. No. 746 of 2013
JUDGMENT:(Per Hon'ble Sri Justice C.Praveen Kumar)
1. The present appeal is filed under Section 96(1) read with Order XLI Rule 1 of C.P.C. assailing the judgment dated 26th June, 2013, wherein, suit filed by the respondent - the plaintiff seeking specific performance of contract was allowed and the suit was decreed directing the defendants to execute a registered sale deed within a period of two months, as the plaintiff has already deposited the balance sale consideration of Rs.25,08,718/-; the defendants were also directed to measure the suit schedule property within the above period and after measuring and executing the registered sale deed, they are entitled to receive the deposited amount, in default, the plaintiff is at liberty to get the registered sale deed through process of law. Challenging the same, the defendants preferred the present appeal.
2. The facts in issue are as under :
The averments in the plaint are that the plaint schedule property originally belongs to one Bukkapatnam Abdul Jabbar and Guljara Begum. Both of them gifted the property to the defendants under registered gift deed dated 5.5.2005 and delivered vacant possession of the same. It is said that since then the defendants are in absolute possession and enjoyment of the suit schedule property. The original gift deed is said to be in the custody of the 2 defendants. On 27.11.2006, all the defendants agreed to sell away the suit property to the plaintiff @ Rs.1,02,000/- per cent. It is averred that the defendants received an amount of Rs.8,40,000/-
being part of sale consideration and executed an agreement of sale on stamp papers (two stamp papers of Rs.50/- each) and delivered the document to the plaintiff. The total extent agreed to be sold by the defendants to the plaintiff is about Ac.0.32 cents or 8.30 square links or 1589 square yards. The value of the property was fixed at Rs.33,48,718/-. It is said that the defendants agreed to receive the remaining sale consideration after measuring the land at their own expenses and executing a registered sale deed five months from the date of agreement of sale i.e., 27.11.2006. The terms of the agreement also show that the defendants shall receive the remaining sale consideration and execute a registered sale deed in favour of the plaintiff or to her order at her expenses covering the suit property. An agreement of sale came to be executed and which was signed by the defendants, scribed by one Pulla Reddy in the presence of two attestors. It is alleged that though the plaintiff was always ready and willing to perform her part of the contract and though requested the defendants to perform their part of contract, the defendants failed to perform their part of the contract. The averments in the plaint show that the plaintiff approached the defendants and in the presence of elders, requested for execution of the agreement, but the defendants were evading the same. As stated earlier, time fixed for performance of the agreement of sale is five months from the date of agreement, which also contains the clause to the effect that if the defendants failed to perform their part of contract, they shall pay double the amount to the plaintiff. It 3 also says that if the plaintiff failed to perform her part of contract, the advance amount shall stand forfeited.
3. The averments in the plaint further show, as the defendants failed to come forward to receive the balance sale consideration, execute a registered sale deed and deliver vacant possession of the property, the plaintiff got issued a legal notice on 19.5.2007, to which a reply was given by the defendants on 26.5.2007. In spite of exchange of notices, the plaintiff was willing to perform her part of the contract, but, however, the defendants failed to come forward. On 8.2.2008 another legal notice was issued by the plaintiff to all the defendants demanding them to carry out the measurements of the suit property as agreed by them and present before the Sub- Registrar, Proddatur on 22.2.2008 for receiving the balance consideration and executing a registered sale deed. Though the defendants received the legal notice and gave a reply on 12.2.2008, they failed to come to the office of Sub-Registrar and execute the sale deed. As the defendants were proposing to sell the above land in favour of others, the present suit came to be filed seeking the following relief :
"Directing the defendants to execute a registered sale deed in respect of the suit property at the expenses of the plaintiff and if the defendants fail to do so, the same may be done by the Hon'ble Court through the process of law;
i. Directing the defendants to deliver the vacant possession of the suit property to the plaintiff within the stipulated time by the Hon'ble Court and if the defendants failed to do so, the same may be done through the process of the Hon'ble Court.
ii. Directing the defendants to pay the costs of the suit to the plaintiff;
and 4 iii. Granting such other and further reliefs as the Hon'ble Court deems fit and proper under the circumstances of the suit in the interest of justice.
Alternative reliefs :-
i. Directing the defendants to pay Rs.16,80,000/- (including the advance of Rs.8,40,000/-) as stated in the agreement of sale, which is agreed and predetermined liquidated damages by the defendants to the plaintiff;
ii. Directing the defendants to pay the costs of the suit to the plaintiff;
and iii. Granting such other and further relief as the Hon'ble Court deems fit and proper under the circumstances of the suit in the interest of justice."
4. A Written Statement came to be filed by the defendants disputing the averments made in the plaint, except to the extent admitted by them. While admitting that the defendants have entered into an unregistered agreement of sale dated 27.11.2006 with the plaintiff and that they have received earnest money of Rs.8,40,000/- towards part payment and that they have executed an agreement of sale in favour of the plaintiff in respect of schedule of property and while disputing the fact of delivery of schedule property to the plaintiff. It is said that the plaintiff failed to perform her part of the contract. It is said that the plaintiff has suppressed the real contents of the agreement in the plaint and the allegation of the plaintiff demanding the defendants to measure the schedule property in the presence of elders is false. It is pleaded that time is the essence of the contract, having regard to the conditions in the agreement and as the plaintiff herself willfully defaulted in compliance of her part, it is urged that the relief sought for by the plaintiff cannot be granted. While admitting the issuance of notice, reply and also legal notice dated 8.2.2008, it is pleaded that the 5 defendants are not aware about the presence of the plaintiff at the Sub-Registrar's Office on 22.2.2008 and that there is no need for the defendants to be present before the Sub-Registrar as the agreement of sale is barred by limitation, since the amount paid under said agreement of sale is already forfeited by virtue of the terms of the agreement.
5. It is further urged in the Written Statement that at the time of entering into the agreement of sale, the plaintiff examined the title deeds, including the link documents, obtained xerox copies of all the documents, took legal opinion from the legal advisor and after satisfying with the title of the defendants over the property, paid the earnest money to the defendants and entered into an agreement of sale. It appears that as the plaintiff could not market the schedule property further, she went back on her promise, which is evident from the inconsistent stand taken in the notices. It is further pleaded that as the period of five months expired on 27.4.2007, the earnest money stands forfeited as per the express terms of agreement and the plaintiff cannot claim the same. It is further averred in the Written Statement that the defendants measured the suit schedule property again and again and informed the same to the plaintiff that the subject property is as per the measurements shown in the agreement dated 27.11.2006. In spite of the same, the plaintiff never came forward to perform her part of the contract. Having regard to the above, it is pleaded that there is no merit in the suit and the same is liable to be dismissed.
6. Basing on the above pleadings, the trial court framed the following issues :
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1. Whether the plaintiff is entitled to specific performance as prayed for?
2. Whether the plaintiff is entitled to refund of Rs.16,80,000/-?
3. Whether the plaintiff is entitled to vacant possession?
4. To what relief?
7. In support of its case, the plaintiff examined P.Ws.1 and 2 and got marked Exs.A1 to A5, while the defendants examined D.Ws.1 to 3 and marked Exs.B1 to B5.
8. Considering the oral and documentary evidence available on record, the suit was decreed with costs. Challenging the same, the present appeal is filed by the defendants.
9. Sri V.R.Reddy Kovvuri, learned counsel appearing for the appellants - the defendants, would contend that the trial court erred in decreeing the suit, as the plaintiff was not ready and willing to fulfil the terms of the agreement of sale. It is further pleaded that the time fixed for performing the contract was for five months, which expired on 27.4.2007 and after the expiry of the time period, notice came to be issued on 19.5.2007. A reading of the first notice dated 19.5.2007 show that the same runs contrary to the terms of the contract. The second notice dated 8.2.2008, according to him, runs contra to the first notice, given on 19.5.2007. According to him, a perusal of the notice dated 19.5.2007 show that request of the plaintiff was for return of the money and not for execution of the terms of the agreement due to non-measurement of the land.
10. Sri Raja Reddy Koneti, learned counsel appearing for the respondent - the plaintiff, would submit that there is nothing unusual in issuing a notice in the month of May, 2007, as the same 7 got to be issued after expiry of five months period. According to him, the terms of the agreement clearly indicates that the property has to be measured and only then payment of money by the plaintiff would arise. Since no steps have been taken for measurement of the land, in spite of informing the same through elders, he pleads that it was the defendants, who are at fault in not performing the contract. According to him, though the plaintiff agreed to purchase the land, but, measurements of the land and fixing of the boundaries is a prime concern, which has to be done by the defendants, as the same was one of the terms of the agreement. According to him, the defendants have failed to perform their part of the contract and as such the plaintiff is entitled for the relief. He further pleads that answers elicited in the cross-examination of P.W.1, namely, the reasons for going back, are false.
11. In reply, Sri V.R.Reddy Kovvuri, relying upon the judgment of this court and also the judgment of the Supreme Court would contend that question of raising a new plea, which was not part of the agreement, does not entitled the plaintiff for the relief claimed in the suit. He took us through the notice dated 19.5.2007, wherein the title of the property was sought to be questioned, which on the face of it is false, as the plaintiff took all the documents and only after verification of the same, entered into an agreement. Therefore, the question of non-furnishing of the documents by the defendants after the agreement was entered into would not arise.
12. In order to appreciate the rival arguments advanced, it will be useful to refer to the evidence on record and contents of the notices. 8
13. The short point that arises for consideration is, Whether the plaintiff was willing and ready to perform her part of the contract under the suit agreement?
14. It is settled principle of law that the grant of relief of specific performance is a discretionary and equitable relief. The questions which are required to be gone into for grant of relief of specific performance are :
(i) Whether there exists valid contract and concluded contract between the parties for sale/purchase of the suit property?
(ii) Whether the plaintiff is ready and willing to perform his/her part of contract and whether he/she is still ready and willing to perform his part as mentioned in the contract?
(iii) Whether the plaintiff has in fact performed his part of the contract and, if so, how and to what extent, in what manner he has performed and whether such performance was in conformity with the terms of the contract?
(iv) Whether it is equitable to grant the relief of specific performance to the plaintiff against the defendant in relation to suit property or it will cause any kind of hardship to the defendant and, if so, how and in what manner and the extent if such relief is eventually granted to the plaintiff; and lastly
(v) Whether the plaintiff is entitled for grant of any other alternative relief, namely, refund of earnest money etc., and, if so, on what grounds?9
15. The aforementioned questions are part of the statutory requirements of Section 16(c), 20, 21, 22 and 23 of the Specific Relief Act, 1963 and the Forms 47/48 of Appendix-A to C of the Code of Civil Procedure. These requirements have to be properly pleaded by the parties in their respective pleadings and proved with the aid of evidence in accordance with law. It is only then the court is entitled to exercise its discretion and accordingly grant or refuse the relief of specific performance depending upon the case made out by the parties on facts. (Vide Kamal Kumar v. Premlata Joshi and others [2019(1) ALD 181 (SC)]
16. In Zarina Siddiqui v. A.Ramalingam 1 the Apex court held that remedy for specific performance is an equitable remedy. The court while granting decree of specific performance exercises its discretionary jurisdiction and the said discretion must be exercized in accordance with sound and reasonable judicial principles. It has been held that equitable discretion to grant or not to grant a relief for specific performance also depends upon the conduct of the parties. The necessary ingredient has to be proved and established by the plaintiff so that discretion would be exercised judiciously in favour of the plaintiff. At the same time, if a party to a lis does not disclose all material facts truly and fairly but states them in distorted manner and misleads the court, the court has inherent power to exercise its discretionary jurisdiction in order to prevent abuse of process of law.
1 (2015) 1 SCC 705 10
17. In order to appreciate the rival arguments advanced it would be appropriate to refer to the oral evidence of the witnesses before dealing with documentary evidence.
18. P.W.1, who is a the plaintiff in the case, in her evidence deposed on the same lines as stated in the plaint. However, in the cross-examination, she admits that on the date of agreement, she verified the original title deeds and only after ascertaining title of the defendants by virtue of title deeds, she entered into an agreement. It is further admitted that the entire terms and conditions in the suit agreement, dated 27.11.2006, knowingly prepared to either parties and she agreed for the same. The relevant portion of cross- examination of P.W.1 is as under :
"On the date of agreement we verified original title deeds. It is true after ascertaining the title of the defendants by virtue of title deeds, we entered into agreement. The defendants, their father and junior paternal uncle, myself and my husband present on the date of agreement. The entire terms and conditions in the suit agreement dated 27.11.2006 knowingly prepared to either parties and we agreed the same."
She further admits in the cross-examination that after enquiries made and after being confirmed that the defendants have salable interest over the schedule property, she entered into agreement of sale with the defendants. An advance of Rs.8,40,000/- was paid to the defendants by her. She further admits that within the stipulated time, it was agreed to comply the contract and on her default, the advance paid by her will be forfeited by the defendants and the agreement will be cancelled on default of the defendants and the defendants have to pay double the advance i.e., Rs.16,80,000/-. The relevant portion of cross- examination of P.W.1 is as under :
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"I do not know the flow of title to the mother of the defendants. It is true after enquiries made and conformed that the defendants have saleable interest over the schedule property, I entered into an agreement of sale with the defendants. The advance of Rs.8,40,000/- (Rupees Eight lakhs forty thousand only) paid to the defendants by me. The time stipulated for 5 months to comply the contract under Ex.A1. It is true within the stipulated time it is agreed to comply the contract, on my default, the advance paid by me will be forfeited by the defendants and the agreement will be cancelled, on default of the defendants, the defendants have to pay double the advance i.e., Rs.16,80,000/-."
She further admits that she did not file any documentary proof to show that she was having balance of sale consideration to be paid within the stipulated time. She further admits that legal notice was not issued to the defendants within the stipulated time realizing her willingness in tendering the balance sale consideration for compliance of Ex.A1. The relevant portion of cross-examination of P.W.1 is as under :
"It is true I did not file any documentary proof to show that I am having possession of balance of sale consideration within stipulated time. It is true I did not got issued any legal notice to the defendants within the stipulated time realizing my willingness tendering the balance of sale consideration for compliance of under Ex.A1."
While admitting that on her instructions Sri C.Sudarsana Reddy, Advocate, issued the first legal notice on 19.5.2007, but, however, said that she does not remember the contents of the said notice. She further says that she does not remember whether she instructed to her Advocate to contend that the defendants have no salable interest and they did not prove their right with necessary documents. The relevant portion of cross-examination of P.W.1 is as under :
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"It is true I got issued a legal notice through Sri C.Sudarsana Reddy, Advocate on 19.5.2007 to the defendants. It is true on my instructions the above said notice issued by my advocate. Ex.B1 is original legal notice dt : 19.5.2007. I do not remember the contents under Ex.B1. I do not remember whether I instructed my advocate to contend that the defendants have no salable interest and they did not prove their right with necessary documents."
The most important part of the admission is where she admits the time stipulated for compliance of contract expired at her instance. The relevant portion of her admission, which according to us, go to the root of the matter is as under :
"The time stipulated for compliance of contract is already expired at my instance, thus I am not entitled either for refund of advance amount or for execution of registered sale deed."
In so far as issuance of second notice dated 8.2.2008 is concerned, she, though admits that she got the said notice issued through one Jinka Ravi, Advocate, but, states that she does not know the contents of the legal notice dated 8.2.2008, which is marked as Ex.A2. However, she admits that she got instructed the recitals in Ex.A2 and claimed for execution of registered sale deed under Ex.A2 after ascertaining the measurements of the schedule property. The relevant portion of cross-examination of P.W.1 is as under :
"Then again I got issued another legal notice dated 8.2.2008 through my another advocate Jinka Ravi, Proddatur to the defendants. I do not know the contents in the legal notice dated 8.2.2008 already marked as Ex.A2. I got instructed the recitals in Ex.A2. I claimed for execution of registered sale deed under Ex.A2 after ascertaining the measurements of the schedule property."
However, to a suggestion that she got issued Ex.A2 after the prices have gone up was denied by her. Though the defendants gave reply under Ex.A3, but, the plaintiff states that she is not 13 aware about contents of Ex.A3. Strangely, she admits that she does not remember when the suit is instituted in the Court on her behalf. The relevant portion of her admission is as under :
"I do not remember when the suit is instituted in the court on my behalf."
Finally, she admits that she has no record to show that she is having possession of balance of sale consideration of Rs.25,08,718/- till today. The relevant portion of her admission is as under :
"It is true I have no record to show that I am having possession of balance of sale consideration of Rs.25,08,718/- till today."
19. P.W.2 was examined only to speak to the execution of the agreement of sale and according to him, to his knowledge, the plaintiff was always ready and willing to perform her part of contract, but, however, in the cross-examination he admits that he does not know the employment of the plaintiff and her capacity to pay the money. He states that he has facial acquaintance with the defendants and that the defendants are brothers. In the cross- examination he admits that he does not know the terms and conditions of sale agreement between the plaintiff and the defendants and he also does not remember the date of execution of the sale agreement between the plaintiff and the defendants. He admits that after attesting the sale agreement he has not seen the said agreement till date. He further admits that he does not know the subsequent events between the plaintiff and the defendants, and he does not know who is the defaulter in the agreement of sale. 14
20. A reading of the evidence of P.W.1, more particularly, the cross-examination shows that she is not speaking the truth. The admissions demonstrate that she alone is responsible for not fulfilling the terms of the contract and getting the document registered. Probably for that reason, the process of issuing notices, taking inconsistent pleas, came to be initiated after the expiry of five months.
21. The answers elicited in the cross-examination, which were referred to above, clearly indicates and demonstrates that the plaintiff alone is responsible for not fulfilling the terms of the contract and get the document registered. A reading of the first notice, which we will refer to a little later, shows that the plaintiff expressed in clear terms that she is not interested to get the suit property registered as she had some doubts with regard to the title of the property. She further sought for refund of the amount. These aspects were never considered by the trial court while deciding the issue. It proceeded mainly on the footing that the defendants failed to take measurement of the land which was a condition precedent for paying the money.
22. At this stage, it will be useful to refer to the evidence of D.Ws.2 and 3, who are two advocates who issued notices on behalf of the plaintiff.
23. D.W.2 is one J.Ravi, a practicing Advocate in Proddatur since 1993. In his evidence he categorically states that the plaintiff approached him on 8.2.2008 and instructed him to issue legal notice for specific performance of agreement of sale dated 27.11.2006 to the three defendants. According to him, he took 15 instructions from the plaintiff and got issued legal notice to the defendants. In the cross-examination he categorically admits that as per the instructions of his client Vijayalakshmi he gave notice to the defendants in the suit. Therefore, the version of P.W.1 in the cross-examination that she was not aware about the contents of notice gets falsified through the evidence of D.W.2 who in categorical terms says that, on the instructions of the plaintiff only he is said to have given the notice on 8.2.2008.
24. D.W.3 is another Advocate by name C.Sudharsan Reddy, who is said to have issued the reply notice on 19.5.2007. According to him, the plaintiff approached him on 19.5.2007 and instructed him to issue notice to the defendants pertaining to schedule property and agreement of sale dated 27.11.2006. He categorically states that the said notice which is placed on record as Ex.B1 came to be issued only on the instructions of Basi Reddy Vijayamma, wife of Venkata Subba Reddy i.e., the plaintiff. From the evidence of D.W.3 it is evident that the notice dated 19.5.2007 came to be issued on the instructions of the plaintiff.
25. Therefore, the version of P.W.1 that she does not remember the contents of the said notice and that she does not know whether she instructed her Advocate to contend that the defendants have no salable interest and they did not prove their rights with necessary documents appears to be false.
26. Before dealing with two notices, it will also be necessary to refer to the evidence of D.W.1, who is the 1st defendant in the case. While in evidence in chief he deposed about the contents of the Written Statement and also denies the contents of the plaint, but, 16 he categorically sates the measurements were already mentioned in the agreement of sale and even thereafter the property was measured and the plaintiff was intimated about the same, but, admits that there is no documentary evidence in proof of the same. In so far as Ex.B3, which is NOC issued by Andhra Pradesh Industrial Infrastructure Corporation Limited, dated 1.5.2007 is concerned, the said document is for alienation of the schedule property addressed to the Sub-Registrar, Proddatur. Though the said document came to be marked through D.W.1, but, strangely no suggestion was given about the purpose for which it was taken and the mala fide intentions, if any, of the defendants in suppressing any fact.
27. In the cross-examination of D.W.1 it has been elicited that though they did not file any documentary evidence to show that the measurements of the property were taken, but, admitted that they have filed the survey plan regarding the schedule property before the Court. He further admits that D2 and D3 did not issue any legal notice to P.W.1 to the effect that they are ready to execute regular sale deed in favour of P.W.1, but, orally informed P.W.1 to come forward for registration of the property after payment of balance sale consideration. It is also elicited that P.W.1 voluntarily came to the house of D.W.1 for purchase of the property. It was further elicited that the real estate was in high boom after execution of the agreement of sale and P.W.1 was having capacity to purchase the schedule mentioned property. He further admits that they are bound to execute the regular sale deed in favour of P.W.1 as per the agreement, but did not do so as P.W.1 failed to pay the balance sale consideration. Though the counsel for the respondent tried to take 17 advantage of admissions of D.W.1, but, they, in our view, may not be of much help to the plaintiff, for the reason that she herself went back in the first notice in the month of May, 2007 i.e., after expiry of five months period. As observe by us earlier, she categorically stated that she is not interested to purchase the property and sought for return of the amount, which clearly indicate that the plaintiff was not ready and willing to perform her part of the contract, more so, having regard to the contents of the reply notice and the contents of the Written Statement with regard to the measurement of land.
28. Keeping these circumstances in mind, it will be useful to refer to the contents of the agreement dated 27.11.2006 entered into by the parties. The relevant portion of which is as under :
"We are agreed to giving you the said schedule property at the rate of Rs.1,02,000/- per one cent and received advance amount of Rs.8,40,000/- from you. Within five months from today onwards we will measure the extent of the schedule property without expenses and after measurements we fix the total amount for the extent of schedule property and then we will hand over to you the schedule property and register the schedule property with your expenses on payment of balance amount at the registration within this five months period whenever you are ready for registration or notice to us for registration."
29. Though the counsel for the appellant took the plea of time being the essence of contract, but the three Judge Bench of the Apex Court in the case of Chand Rani (Dead) By L.Rs. v. Smt.Kamal Rani (Dead) by L.Rs.,2 while dealing with the issue as to whether time is essence of the contract in the case of sale of immovable property, observed as under :
2 AIR 1993 SC 1742 18 "It is a well-accepted principle that in the case of sale of immovable property, time is never regarded as the essence of the contract. In fact, there is a presumption against time being the essence of the contract. This Principle is not in any way different from that obtainable in England. Under the law of equity which governs the rights of the parties in the case of specific performance of contract to sell real estate, law looks not at the letter but at the substance of the agreement. It has to be ascertained whether under the terms of the contract the parties named a specific time within which completion was to take place, really and in substance it was intended that it should be completed within a reasonable time. An intention to make time the essence of the contract must be expressed in unequivocal language."
The Apex Court in the case of Gomathinayagam Pillai and Ors. v. Pallaniswami Nadar 3 held as under :
"It is not merely because of specification of time at or before which the thing to be done under the contract is promised to be done and default in compliance therewith, that the other party may avoid the contract. Such an option arises only if it is intended by the parties that time is of the essence of the contract. Intention to make time of the essence, if expressed in writing, must be in language which is unmistakable : it may also be inferred from the nature of the property agreed to be sold, conduct of the parties and the surrounding circumstances at or before the contract. Specific performance of a contract will ordinarily be granted, notwithstanding default in carrying out the contract within the specified period, if having regard to the express stipulations of the parties, nature of the property and the surrounding circumstances, it is not inequitable to grant the relief. If the contract relates to sale of immovable property, it would normally be presumed that time was not of the, essence of the contract. Mere incorporation in the written agreement of a clause imposing penalty in case of default does not by itself evidence an intention to make time of the essence.
In Saradamani Kandappan vs. S. Rajalakshmi & Ors 4 the Supreme Court, taking into consideration the judgment of the 3 AIR 1967 SC 868 4 (2012) 2 SCC 104 19 Apex Court in K.S.Vidyanadam and others vs. Vairavan5, reiterated the view taken in Vidyanadam's case, which is as under :
"(i) Courts, while exercising discretion in suits for specific performance, should bear in mind that when the parties prescribe a time/period, for taking certain steps or for completion of the transaction, that must have some significance and therefore time/period prescribed cannot be ignored.
(ii) Courts will apply greater scrutiny and strictness when considering whether the purchaser was `ready and willing' to perform his part of the contract.
(iii) Every suit for specific performance need not be decreed merely because it is filed within the period of limitation by ignoring the time-
limits stipulated in the agreement. Courts will also `frown' upon suits which are not filed immediately after the breach/refusal. The fact that limitation is three years does not mean a purchaser can wait for 1 or 2 years to file a suit and obtain specific performance. The three year period is intended to assist purchasers in special cases, as for example, where the major part of the consideration has been paid to the vendor and possession has been delivered in part performance, where equity shifts in favour of the purchaser."
30. Having regard to the judgments referred to above and terms of agreement, it is clear that in the facts of the case, time may not be the essence of contract. But, however, the conduct of the parties assumes significance. For a period of five months there was never any effort by the plaintiff demanding the defendants to execute the sale deed or for measurements of land, as sought now. Though it has been stated that she went to the house of defendants making such request, with the help of elders, but, strangely, none of the elders were examined, nor any document is placed on record to prove that any effort was made during the said period. 5 (1997) 3 SCC 1 20
31. As the defendants failed to perform their part of the contract, a notice was issued five months after the date of execution of the agreement. The first notice, which is marked as Ex.B1, is dated 19.5.2007. The relevant portion of the same reads as under :
"My client purchased the notice schedule mentioned property from No.1 to 3 of you for a valid consideration of Rs.1,02,000/- per cent under a sale agreement dated 27.11.2006 and paid a sum of Rs.8,40,000/- towards 1/4th advance of the sale consideration. In the agreement it was mentioned that the remaining amount has to be paid within 5 months from the date of agreement and before that No.1 to 3 of you has to deliver vacant possession of the site to my client and you have to execute a regular sale deed in favour of my client and before that you have to show the necessary documents to my client. As per the recitals of the agreement the vendor of your father and mother got the property from industrial department and whether he got absolute rights with salable interest or not. For that you have to give a clarification to my client within 5 months from the date of the agreement. My client demanded you all several times to give necessary documents to her to get legal opinion. But there is no response from your side. The period of 5 months expired by 27th April, 2007. Since then and even before my client made several attempts to get registration from you. But intentionally No.1 to 3 of you postponed and so for you have not delivered either the documents or the property to my client. So under the circumstances all the efforts made by my client became futile. So that my client has no interest to get registration of the site from your side and she had a serious doubt with regard to the title of the site."
32. A reading of the said legal notice dated 19.5.2007 issued on behalf of the plaintiff does not anywhere refer to failure on the part of the defendants to get the land measured. On the other hand, the specific plea taken in the notice is that before execution of regular sale deed, the defendants have to show the necessary documents to the plaintiff, as to whether the defendants have got absolute rights with salable interest over the property. It has been specifically pleaded that the defendants have to give a clarification to the 21 plaintiff on the said aspect within five months from the date of the agreement. It is said that in spite of repeated requests by the plaintiff for the documents to get the legal opinion, there was no response from their side. The notice further discloses that the defendants have intentionally postponed the same so as to defeat the interests of the plaintiff and as such sought for return of the advance paid.
33. From the above, it is clear that the plaintiff had no interest to get registered the site from the defendants, as she had a serious doubt with regard to the title of the suit. Hence she called upon the defendants to return back Rs.16,80,000/- (inclusive of penalty). A reading of the above notice makes it clear that no dispute was raised with regard to measurements to be undertaken by the defendants. On the other hand, a new plea has been raised stating that the defendants failed to give necessary documents to get a legal opinion, which was not the content of the agreement. Further, the notice clearly shows that the plaintiff was not interested to get the site registered in her name as she has serious doubt with regard to title of the site.
34. As seen from the record, the plaintiff has already entered into agreement of sale and she is said to have paid advance of Rs.8,40,000/- towards part sale consideration of the said land. The terms of the agreement nowhere speaks about handing over of documents for verification by the defendants. Definitely the plaintiff would not have parted with such huge amount without verifying the documents or without taking any legal opinion in the matter. In fact, the same is reflected in the reply notice dated 26.5.2007. 22
35. A reply to the said notice came to be issued on 26.5.2007, which is placed on record as Ex.A3. A reading of the reply show that the plaintiff has miserably failed to perform her part of the contract, as she failed to call upon the defendants, nor issued any letter to the defendants within a period of five months indicating that she is ready and willing to perform her part of contract by paying balance sale consideration and getting it registered. After the forfeiture of the amount, the present notice came to be issued making an allegation, the contents of which do not form part of this agreement. It has been specifically pleaded that at the time of entering into agreement the plaintiff has examined the title deeds, including link documents and after satisfying herself entered into an agreement of sale. It was further pleaded that the measurements of the land which explicitly mentioned in the agreement clearly show that the defendants measured the property and further measurement is only a formal one and not a condition precedent for specific performance of the contract. It was further stated that the defendants measured the said property again and informed the same to the plaintiff stating that the subject property is as per the measurements shown in the agreement dated 27.11.2006. It is said that in spite of said intimation, the plaintiff never came forward to perform her part of the contract. No doubts have been expressed by the plaintiff as to the salable interest of the defendants' predecessors in title and the same came to be raised for the first time in the legal notice. From the reply given to the legal notice dated 19.5.2007, it is evident that the lands were measured and the extent of the same, including boundaries, were said to have been informed to the plaintiff. The contents of Written Statement 23 that lands were measured and informed to the plaintiffs assume significance. Probably, for this reason the plaintiff in the legal notice got issued on 19.5.2007 never referred to the non-compliance of the terms of the contract with regard to measurement of the land.
36. In fact, the oral evidence of P.W.1 (referred to earlier) supports the contents of reply notice given by the defendants and falsifies the contents of legal notice dated 19.5.2007. As observed earlier, P.W.1 in her evidence categorically admits that documents were shown to her and after being satisfied with the rights of the defendants over the property, she entered into an agreement of sale. Therefore, the contents of the legal notice that the defendants failed to furnish documents is palpably false. On the other hand, it clearly demonstrates that P.W.1 is not speaking the truth.
37. While things stood thus, another legal notice dated 8.2.2008 came to be issued through a different counsel taking a different stand stating that in spite of the plaintiff approaching the defendants several times in the presence of elders and demanded the defendants to measure the schedule property and execute a registered sale deed after receiving the remaining sale consideration, there was no response from the defendants. It was further pleaded that for the first time the plaintiff expressed readiness & willingness to perform her part of contractual obligation and ready to pay the remaining sale consideration. Having regard to the above, the defendants were called upon to take steps for measurement of the schedule property as per the terms of the agreement and present before the Sub-Registrar Office, Proddatur on 22.2.2008 and execute the sale deed. Reply to the said notice came to be given on 24 12.2.2008 stating that the time is the essence of the contract and that the plaintiff cannot set the clock back at this stage. It was specifically stated that the plaintiff cannot blow hot and cold and the inconsistent pleas taken shows that she is not ready to perform her part of the contract.
38. It would be appropriate to note here that P.W.1 in her cross- examination admitted that the time stipulated in the agreement expired at her instance and she is not entitled for advance or for registration of sale deed. As observed by us earlier, the answers elicited in the evidence of P.W.1 and relevancy of the contents of the first notice given were not considered in proper perspective by the trial court.
39. From a reading of the above notices and the reply notice, the contents of which are not disputed, things that emerge out are :-
the stand taken by the plaintiff is not consistent and secondly at the earliest point of time the plaintiff never expressed any readiness and willingness to perform her part of the contract. Insofar as the first ground is concerned, as stated by us earlier, notice dated 19.5.2007 does not anywhere refer to the default committed by the defendants in measuring the land. The entire contents of the legal notice was with regard to non-furnishing the documents for getting a legal opinion, in spite of repeated requests. Further, the plaintiff categorically stated in the said notice that she is not willing to get the document registered, as there is doubt with regard to title, but nowhere in the said notice, she expressed her readiness and willingness to perform her part of contract. On the other hand, she expressed her unwillingness in getting the property registered in her 25 name as there is a doubt with regard to the title. Apart from that, it is also to be noticed that agreement nowhere refers to furnishing of documents by the defendants to the plaintiff. Second thing is that in the second legal notice issued in February, 2008, a different stand is taken to the effect that in spite of the plaintiff along with elders visited the house of the defendants requesting them to measure the land, the defendants failed to do so. If really the defendants have failed to measure the land within a period of five months as required under the agreement, definitely it should have been reflected in the first notice itself. No reasons are forthcoming as to why the plaintiff failed to mention the same, which would have been uppermost in her mind, as the main condition of the contract was to get the land measured and then get the same executed after receiving the balance sale consideration. As observed by us earlier, pleas taken in the two notices run contrary to each other. Further, for the first time, in the second legal notice dated 8.2.2008, the plaintiff expressed her readiness and willingness to perform her part of the contract, which is contrary to the contents of the earlier notice, wherein she refrained from getting the land registered as there is a doubt over the title.
40. Therefore, the evidence on record show that the plaintiff herein has not come to the court with clean hands having regard to the inconsistent pleas taken by her in the two notices and the oral evidence. As stated earlier, on one hand she speaks about rescinding from the agreement by not getting the property registered, while in the second notice issued through another counsel, a different stand is taken stating that she is ready to perform her part of the contract by paying the amount. 26
41. Though the counsel for the respondent relied upon Ex.B3, wherein N.O.C. for sale of plot was obtained after expiry of five months, which according to the respondent shows the bonafides of appellant, but it is to be noted and as observed earlier, the plaintiff went back on the agreement and sought for return of the money paid as advance. In view of above, the argument of the counsel with respect to Ex.B3, pales into insignificance. From the above it is clear that the plaintiff was always not ready and willing to perform her part of the contract and this being a discretionary jurisdiction, we feel that it is not a case for granting a decree for specific performance of the agreement.
42. In view of the law laid down by the Apex Court in Fateh Chand vs Balkishan Das 6; Maula Bux vs. Union of India 7; Delhi Development Authority vs. Grihsthapana Co-operative Group8; and Kailash Nath Associates Vs. Delhi Development Authority and Another 9 it is very clear that any amount given as advance towards sale consideration cannot be forfeited, in spite of there being a clause in the said agreement. The Courts have categorically held that what can be forfeited is only the earnest money and that too if it is a meager amount. It has also been held by the Courts that if the amount paid at the time of entering into an agreement is quite huge, definitely it cannot be treated as an earnest money. The distinction between the earnest money and advance paid has been well defined in the judgments referred to 6 AIR 1963 SC 1405 7 AIR 1970 SC 1955 8 1995 AIR 1176 9 (2015) 4 SCC 136 27 above. It may not be necessary to go into the said aspect in this case.
43. Having regard to the fact that the respondent - plaintiff herein has paid an advance amount of Rs.8,40,000/- towards sale consideration and as the same is not the earnest money, we hold that the respondent - plaintiff is entitled for return of the said amount from the defendants.
44. Hence, the Appeal is allowed in part holding that the plaintiff is not entitled for decree for specific performance of the agreement, dated 27-11-2006. Further, since the suit is filed within the period of limitation and as no plea is advanced to the effect that the same is barred by limitation and having regard to the judgments of the Apex Court with regard to return of the advance amount, we feel that the plaintiff is entitled for refund of the advance paid with interest at 6% from the date of the decree till the date of payment. No order as to costs.
Consequently, miscellaneous petitions pending, if any, shall stand closed.
_________________________________ JUSTICE C. PRAVEEN KUMAR _____________________________ JUSTICE BATTU DEVANAND Date : 01.05.2020 skmr