Andhra HC (Pre-Telangana)
Potluri Babu Rao And Ors. vs Sistla Neelagriva Sastry And Ors. on 18 October, 1994
Equivalent citations: 1994(3)ALT669
JUDGMENT S. Parvatha Rao, J.
1. These five appeals arise out of a common judgment dated 8-4-1991 of the learned Subordinate Judge at Vijayawada in the two suits O.S. Nos. 248 and 453 of 1981. These two suits were dubbed together and evidence was recorded and documents were marked in O.S. No. 453 of 1981. Both the suits are for specific performance of their respective agreements of sale in respect of the same property described in the plaint schedule in O.S. No. 248 of 1981 and in the plaint-A schedule in O.S. No. 453 of 1981 (hereinafter referred to as 'Plaint Schedule Property'). Plaint Schedule Property comprises of an exent of Ac. 1.05 cents of dry land situated in the village of Prasadampadu near Vijayawada in Krishna District (Ac. 0-65 cents in D. No. 63/10 and Ac. 0-66 cents in D. No. 63/11) within the boundaries given in the respective plaint schedules together with Dall Mill known as 'Gopalakrishna Dall Mill' with the machinery and the structures detailed and stated in the registered "lease-deed dated 28-2- 1977" executed by defendants 1 to 8, who are common in both the suits, in favour of Sri Mahalakshmi Dall Mill, a partnership firm respresented by its partners Hemraj and his son, Madanlal.
2. One Potluri Babu Rao laid O.S. No. 248 of 1981 for the specific performance of agreement of sale dated 29-7-1979 (marked as Ex. B. 10) executed by defendants 1 to 8 in his favour agreeing to sell the Plaint Schedule Property for a sum of Rs. 1,55,000/-. Defendants 9 and 10 in that suit are Manoharmal and Madanlal, tenants of the Gopalakrishna Dall Mill in the Plaint Schedule Property. This suit was decreed for the relief of specific performance of the agreement of sale under Ex.B-10. Defendants 1 to 10 were further directed to deliver vacant possession of the Plaint Schedule Property "with all its existing structures and machinery" to the plaintiff after the registered sale-deed was executed. The rest of the claim of Potluri Babu Rao was dismissed with costs. However, it was further decreed in this suit that "defendants 1 to 8 are entitled to receive the rents, if any, due from the defendants 9 and 10 till today (date of decree) and thereafter the plaintiff (Babu Rao) is entitled for the rents from the defendants 9 and 10 till the date of delivery of vacant possession" of Plaint Schedule Property to him and that "the defendants 1 to 8 are further entitled to receive all the amounts that were in deposit to the credit of these two suits made by virtue of the orders of this court (Subordinate Judge's Court at Vijayawada) and High Court". A.S. No. 765 of 1991 has been preferred by Potluri Babu Rao questioning that portion of the judgment and decree of the learned Subordinate Judge in O.S. No. 248 of 1981 dated 8-4-1991 entitling defendants 1 to 8 to receive the rents, if any, due from defendants 9 and 10 till the date of decree and to receive all the amounts that were in deposit to the credit of these two suits made by virtue of the orders made by the lower Court and this Court, and claiming the same instead. A.S. No. 1211 of 1991 has been preferred by the 1st defendant questioning the said judgment and decree for specific performance against him A.S. No. 905 of 1994 has been preferred by defendants 2 to 8, who are the sons of the 1st defendant, questioning the said judgment and decree for specific performance against them. A.S. No. 1280 of 1991 has been preferred by the tenants Manoharmal and Madanlal against the said judgment and decree to the extent it is against them.
3. Sri Mahalakshmi Dall Mill (hereinafter referred to as 'Plaintiff-Firm') is the plaintiff in O.S. No. 453 of 1981. Defendants 1 to 8 in this suit are same as the defendants 1 to 8 in O.S. No. 248 of 1981. The 9th defendant in this suit is Babu Rao the plaintiff in O.S. No. 248 of 1981. This suit is for specific performance of the saleagreementdated 17-7-1979 said to have been entered into by defendants 1 to 8 for the sale of the Plaint Schedule Property to the Plaintiff-Firm or in the alternative for directing defendants 1 to 8 to pay an amount of Rs. 41,472-70 ps. to the plaintiff together with interest at 13 per cent per annum from 17-7-1979 up to the date of realisation, etc. The learned Subordinate Judge dismissed the suit and the Plaintiff-Firm has preferred A.S. No. 1272 of 1991 questioning the said dismissal.
4. I will first deal with A.S. No. 1272 of 1991 relating to O.S. No. 453 of 1981. The agreement of sale sought to be specifically enforced in this suit is an oral one and the defendnats 1 to 8 denied having entered into any such agreement with the Plain tiff-Firm. The learned Subordinate Judge finds that the oral agreement dated 17-7-1979 pleaded by the Plaintiff-Firm is not true and therefore dismissed the Plaintiff-Firm's suit O.S. No. 453 of 1981.
5. The Plaintiff-Firm sought to establish the oral agreement through the oral evidence of P.Ws. 1 to 4 and Ex. A. 16-Voucher which is mainly in Marvadi language and a translation of which is marked as Ex. A-17. P.W. 1 is Madanlal and P.S. 2 is his father, Hemaraj. They are partners of the Plaintiff-Firm. P.W.3 is Mastan Rao, who was the first lessee of Gopalakrishna Dall Mill under Ex. A-23-Lease Deed dated 21-7-1976 and executed in his favour by defendants 1 to 8, the period of lease being up to 31-12-1979. Mastan Rao entered into a partnership with Madanlal, Manoharmal and Tulasidevi, the mother of Madanlal, under the name and style of Mahalakshmi Dall Mill and this firm was in fact doing the business of running the Gopalakrishna Dall Mill under Ex. A-23-Lease Deed till it was dissolved on 1-12-1978 on which date it was reconstituted and given the new name 'Sri Mahalakshmi Dall Mill' under Ex. A-4-Partnership deed dated 1-11-1978 with Madanlal, Hemraj and Tulasidevi as its partners. Sri Mahalakshmi Dall Mill continued the business of running the Gopalakrishna Dall Mill under Ex. A. 23-Lease Deed. To complete the narration relating to the running of the Gopalakrishna Dall Mill, I may state here that Madanlal and Manoharmal entered into a lease agreement dated 28-2-1977 (marked as Ex. A-l) with the first defendant for the running of the Dall Mill from 1-1-1980 to 31-12-1982 i.e., after the expiry of the period under Ex. A-23-Lease Deed. This Lease-Deed dated 28-2-1977 has been referred to in the plaint schedule and the plaint-A schedule of O.S. Nos. 248 and 453 of 1981 respectively for the purpose of the details relating to the machinery etc., in Gopalakrishna Dall Mill. P.W. 4 is one Koneru Venkata Krishna Rao, said to be present at the time when the terms of the oral agreement dated 17-7-1979 were settled.
6. Issue No. 1 in O.S. No. 453 of 1981 is "whether the suit sale agreement dated 17-7-1979 is true, valid and legally binding?" The learned Subordinate Judge considered elaborately and comprehensively the entire evidence on this issue and all aspects of the matter and held against the Plaintiff-Firm, as already stated by me earlier. Sri S. Suryaprakasa Rao appearing for the appellant i.e., Plaintiff-Firm, tried his best to turn me against the findings of the learned Subordinate Judge on this issue.
7. One insuperable obstacle in his way is the radical variance between the pleading relating to the oral agreement dated 17-7-1979 and the evidence which was adduced in support of the said agreement through P.Ws. 1 to 4. the pleading in this regard is in paragraph 14 of the plaint which is as follows:
"14. Subsequently, the Defendants 1 to 8 wanted to dispose off the whole of the plaint 'A' Schedule property and informed all the interested people about the said sale. The first defendant approached the plaintiff also and offered to sell the plaint 'A' Schedule property for which the plaintiff agreed to purchase the same for a consideration of Rs. 1,50,000/- in the presence of Manta Malleswara Rao and Koneru Venkata Rama Rao. The Defendants 1 to 8 thus accepted the offer and agreed with their own free will and volition to make sale of the plaint Schedule property for the said price on 17-7-1979 under the following terms and conditions.
(A) That the plaint'A'Schedule property should be sold to the plaintiff for a sale consideration of Rs. 1,50,000/-. o ' (B) that the accounts should be settled between the Defendants and the Plaintiff, taking into consideration of the amounts due to be paid by the Defendants on the siad pronotes and also subsequent transactions to the Plaintiff and also the amount of Rs. 2,000/- taken as earnest money under voucher on this day itself from the plaintiff by the 1st Defendant out of the sale consideration in confirmation of the said sale agreement and thus whatever amount was outstanding as found due to the plaintiff by 17-7-1979 by the Defendants 1 to 8 should be considered as advance paid out of the consideration of Rs. 1,50,000/-. The Defendants 1 to 8 as per accounts had to pay Rs. 41,472-70 ps. to plaintiff as shown in the plaint 'B' schedule for which the Defendants 1 to 8 agreed.
(C) the Plaintiff should be treated from 17-7-79 as Purchaser and not a sub- lessee or lessee;
(D) the said Masthan Rao should be allowed to pay the lease amount to the Plaintiff for the lease period subequent to 17-7-1979 till the expiry of his lease or till the date of his lease was cancelled;
(E) The Defendants 1 to 8 shall execute the registered sale deed immediately on receipt of balance of consideration from the Plaintiff;
(F) the Plaintiff shall continue in possession and enjoyment of the plaint 'A' Schedule property as Purchaser."
It is also stated in paragraph 15 of the plaint that:
".... As the Plaintiff was ready to pay the balance of consideration within short time and take registered sale deed itself, both the parties did not insist upon executing formal sale agreement."
In paragraph 17 of the plaint it is further stated:
".....As per accounts as shown in Plaint 'B' Schedule the defendants 1 to 8 have to pay Rs. 41,472-70 ps. to the plaintiff by 17-7-79 and have agreed to treat the same as advance paid out of the consideration and so, the Plaintiff is ready and willing to pay the balance of consideration and the Defendants 1 to 8 have to receive the same."
From these pleadings it is clear that the 1st defendant approached the plaintiff and offered to sell the Plaint Schedule Property for Rs. 1,50,000/- and that the plaintiff agreed to the same and this happened on 17-7-1979 in the presence of one Manta Malleswara Rao and P. W. 4. The second important plea taken by the Plaintiff-Firm is that Rs. 2,000/- was taken as earnest money under voucher on 17-7-1979 in confirmation of the said agreement. The third plea taken is that the outstanding amount found due from defendants 1 to 8 to the plaintiff by 17-7-1979 was to be considered as advance paid towards the consideration of Rs. 1,50,000/- and that the said sum was arrived as Rs. 41,472.70 ps. -thus in all Rs. 43,472.70 ps. was already received towards the said consideration of Rs. 1,50,000/-. The fourth plea taken is that as the plaintiff was ready to pay the balance of consideration within short time and take registered sale deed itself, both the parties did not insist upon executing formal sale agreement.
8. On the other hand, P.W. 1 (Madanlal) in his examination-in-Chief states that he went to the 1st defendant 2 or 3 days prior to 17-7-1979 and enquired as to "whether he would sell his mill' and that the 1st defendant agreed and that talks of bargain took place and finally it was settled for Rs. 1,50,000/- and that defendants 1 to 8 "agreed to sell their mill for Rs. 1,50,000/- to us (i.e., to the Plaintiff-Firm)." At that time Potluri Babu Rao and Koneru Venkata Krishna Rao were present. The 1st defendant said that he would come within 2 or 3 days to the Plaintiff-Firm and receive advance and accordingly he came to the Plaintiff-Firm along with Koneru Venkata Krishha Rao (P.W. 4) and received Rs. 2,000/- as advance towards sale consideration of the Mill. Then Ex. A-16 - Voucher was prepared by P.W. 1. The 1st defendant signed on the voucher, P.W. 1 also signed it and P.Ws. 4 attested it. On 17-7-1979 as Hemraj (P.W. 2, father of P.W. 1) was proceeding to Puttur, he said that a regular agreement of sale could be taken later, the 1st defendant agreed for it and asked P.W.I to get stamp papers in two sets for executing contract of sale in counter-part. P.W. 1 was examined in Chief on this on 10-7-1985. Nearly after one year his cross- examination began on 26-6-1986. In the cross-examination, after nearly one year from the examination-in-Chief, P.W. 1 stated that he went to the 1st defendant's house on 14-7-1979 and that on that day the bargain was settled. He also stated that on that day he agreed that at the time of the agreement he would pay Rs. 10,000/- as advance and that the debt due from the 1st defendant would be adjusted from the balance and that the balance was to be paid at the time of the registration. He also stated that on 17-7-1979 Rs. 10,000/- was not paid but only Rs. 2,000/- was paid because agreement was not executed on stamp paper. He also went to the extent of describing Ex.A-16 as an agreement. P.W. 2 (Hemraj) in his evidence added his embellishment as follows:
".....I booked a ticket to go to Puttur on 17-7-1979 for taking treatment. On that day D-l along with Poosa Venkata Krishna Rao came at 4 P.M. and stated that we can enter into sale agreement with the mill. Then I informed the predicament placed by me and told him that I was not having even stamp paper. Then D-l said that he wanted atleast Rs. 2,000/- in advance for purpose of purchasing books for his children. P.W. 1 paid Rs. 2,000/- to D-1. D-l executed Ex. A-16. P.W. 1 filled it. The sale consideration was mentioned in it. K.V. Krishna Rao attested it."
In his cross-examination he added:
"... It was agreed that agreement will be executed in the name of plaintiff firm. Accordingly, an agreement was executed in a voucher. Even if amount is lent, such a form will be used (Ex. A-16)...."
P.W. 3 however described Ex. A-16 as a receipt. He stated that he was called on the ground that agreement was being executed and that as stamp papers could not be procured no agreement was written. He stayed for half an hour but he did not attest Ex. A-16 because he went away to receive phone message. He also stated that P.W. 2 was in a hurry to go and he gave Rs. 2,000/ - towards advance. P.W. 4 stated that the 1st defendant sold the mill to the "Marwadi" and that the deliberations took place in the house of the 1st defendant and that subsequently the 1st defendant received advance at the shop of "Marwadi" and that no agreement was written as "Marwadi" was in a hurry to go. In the cross- examination he gave the name of the "Marwadi" as Madanlal. He does not mention anything about P.W. 2. In the cross-examination he further stated as follows:
".... It was agreed that the amount of Rs. 10,000/- should be paid towards advance. Though the said amount is not paid, still there was an agreement since P.W.I is hurry to go on journey/the agreement could not be written...."
Thus the oral evidence shows that the deal and the terms were settled prior to 17-7-1979 i.e., on 14-7-1979 and that an advance of Rs. 10,000/- was agreed to be paid and that a regular agreement of sale on stamp paper was agreed to be executed and thaton 17-7-1979 only Rs. 2,000/-was paid because no agreement of sale could be executed on stamp paper as P.W. 2 was in a hurry to go and that it was agreed to have a regular agreement of sale after his return. The oral evidence is also to the effect that after P.W. 2 returned, the 1st defendant did not come forward to execute the agreement on stamp paper.
9. It will immediately be noticed that there was no mention in the plaint about any negotiations prior to 17-7-1979 in the house of the 1 st defendant at the instance of P.W.I, about payment of Rs. 10,000/- as advance, about executing an agreement of sale on stamp paper-on the other hand it was stated that both parties did not insist upon executing formal sale agreement, about Ex.A-16 being an agreement in itself and not a mere voucher for Rs. 2,000/-. These contradictions between the pleadings and the evidence adduced are sufficient to disbelieve and reject the story of oral agreement of sale set up by the Plaintiff- Firm. There is no explanation whatsoever from P.Ws. 1 and 2 for the variance. It has been held by Supreme Court in Vinod Kumar v. Surjit Kaur, , that:
".... the pleadings of the parties form the foundation of their case and it is not open to give up the case set out in the pleadings and propound a new and different case....."
10. Another unsurmountable obstacle faced by Mr. Suryaprakasa Rao is the total unreliability of the oral evidence adduced as regards the oral agreement set up by the Plaintiff-Firm. There are galore of contradictions in the evidence of the plaintiff's witnesses-both internal as well as inter se. I will only advert to a few of the glaring contradictions. On 10-7-1985 where P.W.I was examined in Chief he stated that:
"......D-9 Babu Rao, Plaintiff in O.S. No. 248/81 is a broker in real property. He will be selling properties on commission basis. D-1 to D-8 have put up Gopalakrishna Dhall Mill for sale. D-9 came and informed me about this. Two or three days later, we went to D-l and enquired to whether he would sell his mill, to which D-l said that he would sell. At that time D-9 and Koneru Vankata Krishna Rao were present....."
From this it follows that Babu Rao was present at the time the bargain was settled a few days before the date of Ex. A-16 i.e., 17-7-1979. From what P.W.I stated on 8-7-1986 in his cross-examination for the 1st defendant, this took place on 14-7-1979. He was categorical about this on 8-7-1986. He stated on that day:
"... On 14-7-19791 went to the house of D-l in Museum road atabout 1 P.M. I cannot say whether it was working day or holiday. D-l and Koneru Venkata Krishna Rao were present. That was the first time I talked with D-l regarding bargains of mill. The bargain was settled for Rs. 1,50,000/-. No agreement was executed...."
He does not state whether Babu Rao was present or not, on 8-7-1986. However, when he was cross-examined on 1-4-1988 on behalf of 9th defendant P.W. 1 stated:
"... D-9 (Babu Rao) was not present at the time of negotiations, 4 to 5 days before Ex. A-16".
He also stated on that day:
"... 4 to 5 days before 17-7-1979, the bargain was settled for purchase of Mill. I can't say the exact date...."
This was after P.W. 4 (Koneru Venkata Krishna Rao) in his cross-examination on behalf of D-l on 15-9-1987 stated that only the 1st defendant and P.W.I were present on the day when the negotiations took place when he went to the house of the 1st defendant some 4 days prior to the date of Ex. A-16. Thus, on the important fact of the presence of Babu Rao on the date when the terms of the suit oral agreement were settled, there is a contradiction. However, there was no mention any-where about the presence of Manta Malleswara Rao referred to in paragraph 14 of the plaint, at the time of the negotiations and settlement or subsequently on 17-7-1979. Another important contradiction is about execution of agreement. No mention was made by P.W. 1 on 10-7-1985 about the execution of an agreement. On 8-7-1986 P.W. 1 stated in his cross- examination that:
".... On 14-7-1979 we agreed that at the time of agreement we have to pay Rs. 10,000/- as advance and that the debt due to us by D-l to be adjusted from the balance and the balance to be paid at the time of registration....".
But in his cross-examination on 1-4-1988 P.W. 1 stated:
"... There was no contemplation or talks to execute agreement before 17-7-1979. As on 17-7-1979, there was an understanding to execute the agreement, I purchased the stamps....."
This statement that there was no contemplation about executing agreement before 17-7-1979 is in conflict with the earlier statement that on 14-7-1979 it was agreed that Rs. 10,000/- should be paid as advance at the time of the execution of the agreement. Yet another vital contradiction in P.W. l's evidence is as regards Ex. A-16. In his examination-in-Chief he stated:
"... Then D-l received Rs. 2,000/- as advance towards the sale consideration of the mill, then a voucher was prepared by me. I gave Rs. 2,000/-to D-l. D- l signed in the voucher. I also signed in that voucher. It is Ex. A-16. KoneruVenkata Krishna Rao attested Ex. A-16. It is not true that I obtained the singnature of D-l on blank form. On that date of A-16, my father was proceedings to Puttur. So he said that a regular agreement of sale can be taken later....."
It is also to be noticed that in his examination-in-chief P.W. 1 did not make any mention about the presence of Mastan Rao. In his cross-examination on 8-7-1986 P.W.1 stated:
".... We called Muta Mastan Rao also as D-l came.... We called him to be witness for agreement to be entered with D-l........We got an agreement executed by D-l. But we did not pay Rs. 10,000/-. That day agreement was not executed on stamp paper. As it was not executed on stamp paper, we did not pay Rs. 10,000/- but we paid only Rs. 2,000/-. On 17th when we paid Rs. 2,000/- we got agreement executed styling it as agreement. Ex. A-16 is the said agreement which I mentioned. Ex. A-16 does not show words agreement in printed words. In Ex. A-16 D-l signed under words received payment of cash. I signed at the place payee's singature in Ex. A-16.... Even when we lend, we use the same voucher form Ex. A-16. If the Hindi Language in Ex. A.16 is ignored, Ex. A-16 shows that D-l received Rs. 2,000/- on'y .... As we thought of mentioning all details in stamped agreement, other conditions were not mentioned in Ex. A-16. There was agreement. It is Ex. A-16....."
It has only to be noticed that even in the plaint it was only stated that Rs. 2,000/- was "taken as earnest money under voucher" and that the voucher was not described as an agreement. I am of the view that on the basis of this selfcontradicting and unreliable oral evidence adduced on behalf of the Plaintiff-Firm it is not possible to uphold the oral agreement set up by it.
11. Ex.A-16 is the only document produced to substantiate the oral agreement. Far from improving the case of Plaintiff-Firm as regards the oral agreementsetupbyit,Ex.A-16makes it highly suspect. It is admitted by P.Ws.l and 2 that there is a correction in the date of Ex. A-16. Even to the naked eye it is obvious that 12-7-1979 was corrected as 17-7-1979. They have not given any explanation for the correction. The 1st defendant in his evidence as D.W. 2, no doubt admits his signature and his writing therein Rs. 2,000/- in figures and in words. Admittedly the other writing in vernacular is in the hand of P.W. 1 and it could have been written at any time because the voucher was in his custody. If really there was an agreement to sell as pleaded by the Plaintiff-Firm, nothing prevented P.Ws. 1 and 2 from requiring the 1st defendant to write in his own hand that the sum of Rs. 2,000/- was received by him as earnest money or advance or towards the alleged agreement. On the evidence adduced, it is not possible to accept Ex. A-16 as anything more than a mere receipt for Rs. 2,000/- received by the 1st defendant. The other vouchers produced on behalf of the Plaintiff-Firm show that the 1st defendant was in the habit of borrowing moneys on Mahalakshmi Dal! Mill, Vijayawada with P.W. 1 signing above "Payee's signature" (Exs. A-27,28 and 29). P.W. 2 himself stated that the 1st defendant wanted money for the purchase of books for his children. This is consistent with what D.W. 2 (the 1st defendant) stated that he only borrowed Rs. 2,000/- as he was in need of money. By no stretch of imagination can Ex.A-16 be treated as an agreement for the sale of the plaint Schedule Property. I agree with the learned Subordinate Judge in not placing any reliance on Ex. A-16 as supporting the oral agreement in question.
12. It is not in dispute that the Plaint Schedule Property is the joint property of defendants 1 to 8 and that it is not a joint family property. P.W. 1 accepts this. He stated in his evidence that by 28-2-1977 the 1st defendant and his sons were divided. There is no reliable and acceptable evidence to establish that defendants 2 to 8 agreed for the sale of Plaint Schedule Property to the Plaintiff- Firm. Though P. W. 1 stated in his examination-in-chief on 10-7-1985 that the 1st defendant's sons were also present when he went to D-l prior to 17-7-1979 and that defendants 1 to 8 agreed to sell their mill for Rs. 1,50,000/- to the Plaintiff- Firm and at that time Babu Rao and P.W. 4 were also present, afterwards he himself denies the presence of Babu Rao at that time. P.W.4 also does not say that the sons of the 1 st defendant were present at that time. On the other hand, in his cross-examination he was very emphatic in stating that only D-l and P.W.I were there when he went to the latter's house 4 or 5 days prior to 17-7-1979 i.e., the day when Rs. 2,000/- was paid to the 1st defendant. In his cross-examination on behalf of D-2 to D-8 on 20-8-1986 P.W. 1 stated as follows:-
"... D-l to D-8 were present at that time (i.e., prior to 17-7-1979). All of them agreed for the sale. I did not talk with D-2 to D-8 and vice-versa. I do not know whether at that time D-2 to D-8 were studying or doing job or business. I did not ask D-2 to D-8 whether they agreed for sale, and they also did not state whether they agreed or not for sale. I did not take anything from D-2 to D-8 in writing that they agreed for sale. D-l was negotiating on his behalf and on behalf of his sons. I did not direct discuss with D-2 to D-8 at any time. As D- l did not come with his sons, I did not obtain anything from D-2 to D-8 regarding sale..."
This is enough to establish that there is no agreement whatsoever between the Plaintiff-Firm and defendants 2 to 8 as regards the sale of Plaint Schedule Property. There is not an iota of evidence to establish that the lst defendant had any authority to negotiate for the sale of the Plaint Schedule Property on behalf of defendnats 2 to 7 and even on behalf of the 8th defendant who was a minor at that time, as per law.
13. The learned Subordinate Judge in his judgment pointed out several other inconsistencies also which go against the oral agreement pleaded by the Plaintiff-Firm. It is not necessary to detail them here. I am satisfied that the case set up by the Plaintiff-Firm relating to the oral agreement is highly artificial and hard of credence.
14. In the circumstances, I have to hold that nothing concrete and reliable is there to establish that defendnats 1 to 8 agreed to sell the Plaint Schedule Property to the Plaintiff-Firm and that Rs. 2,000/- was paid as 'earnest money' as pleaded or as 'advance' as sought to be made out through Ex. A-16.
15. In Mayawnti v. Kaushalya Devi, , the Supreme Court has held as follows:
".... In a case of specific performance it is settled law, and indeed it cannot be doubted, that the jurisdiction to order specific performance of a contract is based on the existence of a valid and enforceable contract.... Where a valid and enforceable contract has not been made, the court will not make a contract for them. Specific performance will not be ordered if the contract itself suffers from some defect which makes the contract invalid or unenforceable.... It is, therefore, necessary first to see whether there has been a valid and enforceable contract and then to see the nature and obligation arising out of it........"
In that case it was found that there was no consensus ad idem and in that connection the Supreme Court observed:
"The specific performance of a contract is the actual execution of the contract according to its stipulations and terms, and the courts direct the party in default to do the very thing which he contracted to do. The stipulations and terms of the contract have, therefore, to be certain and the parties must have been consensus ad idem. The burden of showing the stipulations and terms of the contract and that the minds were ad idem is, of course, on the plaintiff. If the stipulations and terms are uncertain, and the parties are not ad idem, there can be no specific performance, for there was no contract at all....."
16. In the case of an oral agreement of sale of immobable property the burden is very heavy on the plaintiff to establish the same by clear and acceptable evidence. The plaintiff in such a case has to establish convincingly about consensus ad idem between the parties and about the terms and conditions agreed to by the parties. In the present case no agreement even is made out by the Plaintiff-Firm by cogent, consistent and reliable evidence.
17. I, therefore, uphold the finding of the learned Subordinate Judge on Issue No. 1 and hold that O.S. No. 453 of 1981 was rightly dismissed by him. In the result, A.S. No. 1272 of 1991 is dismissed with costs.
18. Now I will deal with that part of the judgment of the learned Subordinate Judge dealing with the issues raised in O.S. No. 248 of 1981 and granting the relief of specific performance of Ex. B-l0 argeement of sale in favour of Babu Rao the plaintiff therein, which is questioned in the remaining four appeals as already stated above.
19. The execution of Ex. B-10 agreement by defendants 1 to 8 in favour of Babu Rao agreeing to sell the Plaint Schedule Property is not in dispute. However, I have to mention that on behalf of the 8th defendant, who was a minor at the time when Ex. B-10 was executed i.e., on 29-7-1979, the additional pleas taken are that it is not beneficial to him and that there was no legal necessity to sell the Plaint Schedule Properly and that the consideration was low and inadequate and that the 1st defendant as guardian did not act prudently. The learned Subordinate Judge held against the 8th defendant on the issue framed in this regard (issue No. 2) i.e., 'whether the suit agreement is valid and enforceable and whether it is binding on the minor 8th defendant?" The 8th defendnat is the 7th appellant in A.S. No. 905 of 1994 preferred by defendants 2 to 8 against the judgment and decree of the learned Subordinate Judge in O.S. No. 248 of 1981. It is not in dispute that the 8th defendant became a major by the time O.S. No. 248 of 1981 was disposed of by the learned Subordinate Judge. I find that the 8th defendant himself singed the vakalat in A.S. No. 905 of 1994. No ground is raised in A.S. No. 905 of 1994 questioning the finding of the learned Subordinate Judge on issue No. 2 in this suit.
20. As per Ex. B-10 agreement, defendants 1 to 8 agreed to sell the Plaint Schedule Property to Babu Rao for a consideration of Rs. 1,55,000/-. Rupees 20,000/- was paid by Babu Rao on the date of the said agreement i.e., on 29-7-1979, towards the sale consideration and that is not in dispute. As regards the payment of the balance consideration of Rs. 1,35,000/-Babu Rao states in his plaint that the main and the material terms of the agreement are:-
(i) Out of the remaining consideration, the plaintiff should pay an amount of Rs. 20,000/- on or before 29th September, 1979 to defendants 1 to 8, and
(ii) Out of the balance of the consideration after paying the said Rs. 20,000/- the plaintiff should discharge the debts to be specified by defendants 1 to 8 and obtain vouchers from the creditors, and
(iii) The plaintiff should pay the balance remaining to defendants 1 to 8 before the Sub-Registrar at the time of registration of the sale deed to be executed by defendants 1 to 8.
The agreement provides that the sale deed should be executed and registered in the name of the person specified by the second party i.e, Babu Rao, within one month from the date of obtaining the permission from the Urban Land Ceiling Authorities. The agreement also provides that in case if any of the parties commit default in performing the obligations undertaken within the stipulated time, the defaulting party shall compensate all the loss suffered by the other party.
21. The stand taken by Babu Rao in his plaint as regards payment of consideration is as follows:- He paid Rs. 5,000/- under the suit agreement on 10-9-1979. HealsopaidRs.2,000/-on30-10-1979;Rs.l,000/-onl7-ll-1979;and Rs. 1,000/- on 28-11-1979 and obtained receipts from the 1st defendant. These payments are not in dispute and they are evidenced by Exs. B-ll to B-14, Ex. B-ll being the endorsement on Ex. B-10 and Exs. B-12 to B-14 being separate receipts. It is further stated in paragraph 8 of the plaint as follows:-
"On the night of 18th day of March, 1980 the 1st defendant came to the plaintiff's house and requested him to pay Rs. 5,000/- (Rupees Five thousand only) stating that the Municipal employees have been threatening to destrain the first defendant's movables for arrears of taxes and that the amount would be taken as a part payment under the agreement of sale. The amount was paid by the plaintiff and the first defendant left the place in a hurry without passing receipt."
As regards his readiness and willingness to pay Rs. 20,000/- payable on or before 29-9-1979, in paragraph 10 of the plaint, it is stated as follows:-
"Out of the Rs. 20,000/- payable by the plaintiff before 29-9-1979 the plaintiff paid Rs. 5,000/- on 10-9-1979 and was ready to pay the balance of Rs. 15,000/- also. But the defendant No. 1 said that the plaintiff might pay the amount to the creditors to be mentioned by him. First defendant received Rs. 5,000/-, Rs. 2,000/-, Rs. 1,000/- and Rs. 1,000/- on the dates mentioned above,"
As regards payments to be made to the creditors of defendants 1 to 8 in discharge of their debts, it is stated in paragraph 11 as follows:-
"The plaintiff has been requesting the 'defendants 1 to 8 to specify the particulars of the creditors of them whose debts were to be discharged, so that the plaintiff could discharge them and obtain vouchers from them. But the defendants have not cared to do so in spite of the repeated requests of the plaintiff on the pretext that they would do so after obtaining the permission from the Urban Land Ceiling Authority, etc."
22. Babu Rao also complains in the plaint that though under Ex.B-10 agreement of sale the lessees of the Gopalakrishna Dall Mill were to pay the rents to him, from 1-1-1979 no rents were paid to him. He states that the said Mill was originally leased by defendants 1 to 8 to Menta Masthan Rao under a registered lease deed dated 21-7-1976 (marked as Ex. A-23) upto31-12-1979 and that Manohar Mal and Madan Lal (defendants 9 and 10) were originally the sublessees under M. Mastan Rao and that later on they entered into a lease agreement dated 28-2-1977 (marked as Ex. A-l) with defendants 1 to 8 agreeing to take on lease the said mill for the period commencing from 1-1-1980 and endingwith31-12-1982 the annual rent being Rs. 8,000/-for the site and the mill and Rs. 5,000/- for the machinery and other samans i.e., in all Rs. 13,000/-. In the plaint lie states: "according to the terms of the suit agreement of sale, defendants 9 and 10 are bound to pay the rents payable from 1-1-1979 to the plaintiff alone" and not to defendants 1 to 8. Even though he was asking defendants 1 to 8 to issue notices along with him to Manohar Mal and Madan Lal asking them to pay the rents to him alone, defendants 1 to 8 did not cooperate with him and were postponing the issue. Manohar Mal and Madan Lal did not make any payment to him and therefore they have to pay Rs. 13,000/- for each of the years 1979,1980 and 1981 i,e., Rs. 39,000/- in all. He also states in the plaint that he received a telegram (marked as Ex. B-15) on 4-4-1980 from the 1st defendant stating"urban ceiling authority not granted permission-sale agreement automatically cancelled registered notice follows". He also received lawyer's notice dated 3-4-1980 issued on behalf of defendants 1 to 8 (marked as Ex. B-16). He contends that the suit agreement was wrongfully rescinded by defendants 1 to 8. He states that he was not informed about the orders of the Urban Land Ceiling Authority nor was he shown the order. In spite of his demand, he was not supplied any copy of the same. He states that the allegation that the Urban Land Ceiling Authority refuses permission except in respect of 696 square meters of land in the Plaint Schedule Property is utterly false and that it is false to say that Ex. B-10 agreement of sale automatically stood cancelled. He also contends that defendnts 1 to 8 cannot unilaterly manage to get a refusal for die purpose of frustrating the suit agreement of sale deliberately. It has to be noted here that the permission refused by the competent authority under the Urban Land (Ceiling and Regulation) Act, 1976 (hereinafter referred to as the 'U.L.C. Act') was under Section 27 of the U.L.C. Act. Babu Rao gave a detailed reply dated 25-4-1980 through his advocate (marked as Ex. B-17).
23. The 1st defendant states in his written statement that there was division in status between himself and defendants 2 to 8 in the year 1969 and mat since then defendants 1 to 8 have been enjoying the Plaint Schedule Property as coowners i.e., tenants in common and that Ex. B-10 agreement was executed by them as co-owners. Babu Rao admitted in the plaint that in Ex. B-17 notice he was informed of this. The main contentions advanced by the 1st defendant are that (i) the performance of Ex. B-10 agreement had become impossible by reason of the refusal of me permission under the U.L.C. Act for the sale of the Plaint Schedule Property as a whole and because of the said impossibility, defendants 1 to 8 were discharged from the performance of the said agreement; (ii) the allegation that Babu Rao was ready to pay Rs. 15,000/- and that the 1st defendant told him that the amount might be paid to the creditors mentioned by him is absolutely false. It is a material condition of Ex. B-10 agreement that Babu Rao should pay an amount of Rs. 20,000/- on or before 29-9-1979 to defendants 1 to 8. As Babu Rao failed to fulfil the said material condition and paid only Rs. 5,000/-by 29-9-1979 he committed default in making the payment of Rs. 20,000/- as stipulated. Therefore Babu Rao is not entitled to the specific performance of the contract; (iii) the allegation that the 1st defendant received Rs. 5,000/- on the night of 18-3-1980 for payment of arrears of taxes of the Municipality and that he went away hurriedly without passing a receipt, is false to die knowledge of Babu Rao. The 1st defendant never received the said sum of Rs. 5,000/- from Babu Rao either on the night of 18-3-1980 or at any other time; (iv) the allegation that Babu Rao had been requesting defendants 1 to 8 to specify the particulars of the creditors and that they did not care to give the details on the pretext that they would do so after obtaining the permission of the Urban Land Ceiling Authority is not true. It is unbelievable that Babu Rao who could not keep up his promise as to the payment of Rs. 20,000/- was ready to pay the debts of defendants 1 to 8 even before the permission of the Urban Land Ceiling Authority was granted. Babu Rao never asked defendants 1 to 8 to specify the particulars of the said creditors and they never evaded the issue; and (v) the allegation that Manohar Mal and Madan Lal (defendants 9 and 10) were bound to pay rents payable from 1-1-1979 to Babu Rao alone is without any basis because Menta Masthan Rao continued as tenant till the end of the year 1979 and under Ex. A-l lease agreement the lease in favour of Manohar Mal and Madan Lal was to commence only from 1-1-1980. The lease amount payable by Menta Masthan Rao for the year 1979 was only Rs. 9,000/- and not Rs. 39,000/-. It is not necessary to traverse the other contentions raised in the written statement of the 1st defendant. Defendants 2 to 7 adopted the written statement of the 1st defendant. I already referred to the contentions raised in the written statement filed on behalf of the 8th defendant who was a minor at that time.
24. Babu Rao, the plaintiff in O.S. No. 248 of 1981, examined himself as D.W.l and he is the sole witness on his side. The 1st defendant and the 6th defendant examined themselves as D.Ws. 2 and 3. They are the main witnesses on the side of the vendors. The evidence of D.Ws. 4 and 5 is not of any materiality for the consideration of the questions at issue in the present appeal.
25. On the question whether Babu Rao was ready and willing to perform his part of Ex. B-10 agreement of sale, the learned Subordinate Judge found that he was. As regards non-payment of the entire sum of Rs. 20,000/-by29-9-1979, the learned Subordinate Judge observed that if there was any delay in the payment of the monies, defendants 1 to 8 were entitled for compensation, but they were not entitled to concel the agreement He observed that in the agreement itself, there was no stipulation for its cancellation and that on the other hand, it was specifically mentioned therein that if any breach was there by either party, they were entitled only for compensation. He held:
"In view of the said condition in Ex. B-10 agreement of sale, the failure on the part of D-9 in payment of the stipulated amount of Rs. 20,000 / - within the time specified does not entail the cancellation of the contract Ex. B-10; at best D-l to D-8 are entitled for compensation or interest on the unpaid amount."
He also found that Babu Rao had money at all relevant times because his bank accounts as per Exs. B-33 and B-34 pass books clearly showed that he was having money at the relevant times and the certificate Ex. B-35 issued by the Bank Manager proved that he was having money at the relevant times. He also observed that if really Babu Rao failed to pay the said amount when demanded by D-l to D-8 by way of notice, then there would have been some force in the contention on their behalf, and that admittedly in the present case defendants 1 to 8 never demanded Babu Rao to pay the said sum of Rs. 20,000/- by way of any notice or even otherwise. The learned Subordinate Judge did not discuss the plea of Babu Rao that he did not pay the entire sum of Rs. 20,000/- as stipulated in the agreement at the instance of the 1st defendant himself. Though he referred to the contention advanced on behalf of defendants 1 to 8 that Babu Rao must prove both his readiness and willingness from the date of contract to the time of filing of the suit and till the date of the decree and his failure to do so would not entitle him to claim specific performance, and to the various decisions cited in that regard, the learned Subordinate Judge skirted that question and took for granted that proof of capacity to pay would also amount to proof of willingness to pay. I have to observe that the learnd Subordinate Judge did not discuss the evidence of Babu Rao as D.W. 1 as regards his plea relating to the non-payment of the sum of Rs. 20,000/- by 29-9-1979.
26. On the question whether Babu Rao was entitled to the relief of specific performance in view of the false plea taken by him that he made another payment of Rs. 5,000/- on the night of 18-3-1980 towards the consideration under Ex. B-10 agreement, the learned Subordinate Judge held that it was the case of Babu Rao that he made the said payment without obtaining any voucher and since there was no voucher or document evidencing the said payment, he wanted to give up that payment and he was prepared to pay that amount again, and therefore the question of denial by defendants 1 to 8 did not arise. He also held that therefore the decisions of this Court in K. Venkatasubbayya v. K. Venkateswarlu, ., of the Madras High Court in Ramaswamy Gounder v. Venkatachalam, 1976 (I) MLJ 243, and of the Calcutta High Court in Sahida Bibi v. Sk. Golam Muhammad, ., relied upon by defendants 1 to 8 had no bearing on the facts of the present case. The learned Subordinate Judge did not examine the evidence of D.W.I on this aspect of the matter and whether it supported the plea taken by him in that regard.
27. The learned Subordinate Judge held that in view of the decision of the Supreme Court in Bhim Singhji v. Union of India, , holding that sub-section (1) of Section 27 of the U.L.C. Act was invalid in so far as it imposed a restriction on transfer of any urban or urbanisable land with a building which was within the ceiling area and therefore such property would be transferable without the constraints mentioned in the said sub-section, the refusal of permission by the competent authority under Ex.B-22 dated 19-12-1979 for the sale of the plaint Schedule property except to the extent of 696 square meters would not render Ex. B-l0 agreement in capable of specific performance. He also held that, in view of G.O. Ms. No. 733/88 dated 31-10-1988 issued by the State Government excluding Prasadampadu Panchayat along with other Panchayats from the purview of the U.L.C. Act thereby enabling the owners therein to transfer agricultural and vacant lands without any permission from the authorities under the U.L.C. Act, there was no bar to the specific performance of Ex. B-10 agreement. Finally, he held on this aspect of the case, relying on the decision of the Supreme Court in Bai Dosabai v. Mathurdas, . as follows:-
"Therefore from the above decision it is clear that the G.O. (G.O. Ms. No. 733/88'dated 31-10-1988) is applicable to this case and as per the said G.O. Urban Land Ceiling Act is not applicable to the lands at Prasadampadu as they are exempted from the purview of the said Act. Therefore, there is no substance in the arguments of the learned counsel for D-l to D-8 that permission is necessary to transfer the lands".
28. Mr. J.V. Suryanarayana Rao, appearing for the 1st defendant, who is the appellant in A.S. No. 1211 of 1991 advanced the main arguments against the judgment and decree of the learned Subordinate Judge in O.S. No. 248 of 1981 which were adopted by Mr. P. Sri Raghuram appearing for defendants 2 to 8, who are the appellants in A.S. No. 905 of 1994. Mr. J.V. Suryanarayana Rao contended that the evidence on record did not disclose that Babu Rao was throughout ready and willing to perform his part of the agreement of sale under Ex. B-10 and that he had not performed all the terms of the said agreement which he expressly or by necessary implication ought to have performed by the date of the suit and that he had not come to the Court with clean hands and that the facts of the case and his conduct did not entitle him or qualify him to the grant of equitable relief of specific performance of Ex. B-10 agreement sought by him. He also contended that even though the 1st defendant repudiated Ex. B-10 agreement, that did not absolve Babu Rao from performing his part of Ex. B-10 agreement as contracted by him when he did not accept the repudiation and did not rescind the contract and sought specific performance of the contract on the basis that the contract was alive and continued to be in force. He placed before me various decisions in support of his contentions both of the English and the Indian Courts and also took me through the evidence on record to establish how the stand taken by Babu Rao in his plaint was not supported by the evidence adduced by him. Mr. P. Sri Raghuram sought to urge that as on the date when the suit was filed, Ex. B-10 agreement was furstrated not only because of the refusal of the competent authority under Ex. B-22 to grant permission for the sale of the plaint Schedule property except for 696 square meters, but also because, under Ex. B-20 proceedings of the competent authority under the U.L.C. Act, defendants 1 to 8 had to surrender vacant land in excess of their ceiling limits, and therefore there was a legal bar for the sale of the plaint schedule property unless the Government granted exemption under Section 20 (1) (b) of the U.L.C. Act. He also relied on the decision of the Supreme Court in S. Vasudeva v. State of Karnataka, (1993) 3 SCC 467, wherein it was held that the provisions of Section 20 (1) (b) of the U.L.C. Act did not permit the State Government to exempt vacant land in excess of the ceiling limit for the purposes of transfer.
29. Mr. P. Ramachandra Reddy appearing for Babu Rao, the plaintiff in O.S. No. 248 of 1981, submitted that when the 1st defendant repudiated Ex. B-10 agreement, it was not necessary for Babu Rao to tender the balance consideration and relied on the judgment of the Supreme Court in International Contractors Ltd. v. Prasanta Kumar, . He also relied on Ex. B-15 telegram dated 2-4-1980 sent by the 1st defendant to Babu Rao and Ex. B-16 lawyer's notice dated 3-4-1980 sent on behalf of defendants 1 to 8 to the advocate of Babu Rao, wherein defendants 1 to 8 purported to cancel Ex. B-10 agreement on the ground that urban land ceiling authority did not grant permission for the sale in respect of the entire plaint Schedule property covered by that agreement and contended that therefore the performance of the contract became impossible resulting in automatic cancellation of the agreement. He contended that the cancellation of the agreement was bad and that the agreement was not repudiated on the ground that Babu Rao did not make payments as per the agreement. The learned counsel also submitted that the plea of Babu Rao as regards his making of payment of Rs. 5,000/- on the night of 18-3-1980 could not be said to be a false plea merely because he could not prove the payment as no receipt was taken.
30. Law is well settled that a contract does not necessarily come to an end on its repudiation by one of the contracting parties. In Edridge v. R.D. Sethana, (1932-33) 60 Indian Appeals 368 = AIR 1933 P.C. 233., the Privy Council held that a wrongful repudiation by one party could no, except by the election of the other party so to treat it, put an end to an obligation; and that if the other party still insisted on performance of the contract the repudiation was what was called 'brutum fulmen', that is, the parties were left with their rights and liabilities as before; and that a wrongful repudiation of a contract by one party did not of itself absolve the other party, if he sued on the contract, from establishing his right under the contract by proving performance by him of conditions precedent. In Howard v. Pickford Tool Co. Ltd. 1951(1) King's Bench 417. Asquith L.J., put it piquantly when he observed:
".....An unaccepted repudiation is a thing writ in water and of no value to anybody: it confers no legal rights of any sort or kind".
Evershed, M.R.referred to the speech of Lord Simon, L.C. in Heyman v. Darwins LD., 1942 Appeal Cases 356 as follows:-
"that if the conduct of one party to a contract amounts to a repudiation, and the other party does not accept it as such but goes on performing his part of the contract and affirms the contract, the alleged act of repudiation is wholly nugatory and ineffective in law."
In Heyman's case, 1942 Appeal Cases 356. Viscount Simon L.C further clarified as follows:-
"If one party so acts or so expresses himself, as to show that he does not mean to accept and discharge the obligations of a contract any further, the other party has an option as to the attitude he may take up. He may, notwithstanding the so-called repudiation, insist on holding his co- contractor to the bargain and continue to tender due performance on his part. In that event, the co-contractor has the opportunity of withdrawing from his false position, and even if he does not, may escape ultimate liability because of some supervening event not due to his own fault which excuses or puts an end to furhter performance; a classic example of this is to be found in Avery v. Bowden (1855) 5 E. & B. 714. Alternatively, the other party may rescind the contract, or (as it is sometimes expressed) 'accept the repudiation', by so acting as to make plain that in view of the wrongful action of the party who has repudiated, he claims to treat the contract as at an end, in which case he can sue at once for damages. 'Rescission (except by mutual consent or by a competent court)' said Lord Summer in Hirji Mulji v. Cheong Yue Steamship Co., Ltd. (1926) A.C. 497 is the right of one party, arising upon conduct by the other, by which he intimates his intention to abide by the contract no longer. It is a right to treat the contcontract as at an end if he chooses, and to claim damages for its total breach, but it is a right in his option.' But repudiation by one party standing alone does not terminate the contract. It takes two to end it, by repudiation, on the one side, and acceptance of the repudiation, on the other."
In the present case, Babu Rao does not stand on recission of contract by him on the repudiation by defendants 1 to 8. If that was his stand, he could not have laid the suit for specific performance which could be only on the basis of subsisting and continuing contract - which meant that he was throughout ready and willing to perform his part of the contract. The historical roots of this legal position were traced by Lord Blanes-burgh speaking for the Judicial Committee in Ardeshir Mana v. Flora Sassoon, (1927-28) 55 LA. 360 = AIR 1928 P.C. 208., as follows:-
"All this is, historically, the explanation of the fact, that in relation to a contract to which the equitable form of relief was applicable, a party thereto had two remedies open to him in the event of the other party refusing or omitting to perform his part of the bargain. He might either institute a suit in equity for specific performance, or he might bring an action at law for the breach. But-and this is the basic fact to be remembered throughout the present discussion - his attitude towards the contract and towards the defendant differed fundamentally according to his choice.
Where the injured party sued at law for breach, going, as in the present case, to the root of the contract, he thereby elected to treat the contract as at an end and himself as discharged from its obligations. No further performance by him was either contemplated or had to be tendered. In a suit for specific performance, on the other hand, he treated and was required by the Court to treat the contract as still subsisting. He had in that suit to allege, and if the fact was traversed, he was required to prove a continuous readiness and willingness, from the date of the contract to the time of the hearing, to perform the contract on his part. Failure to make good that averment brought with it the inevitable dismissal of his suit."
This has now become part of the enacted law. Therefore Mr. P. Ramachandra Reddy is not right in contending that repudiation of a contract by defendants 1 to 8 would absolve Babu Rao from performing his part of the contract by making payments as agreed to by him and showing that he had been ready and willing to perform his part of the contract throughout. The Supreme Court in Gomathinayagam Pillai v. Palaniswami Nadar, . , referred to the said passage in Ardeshir Mama's case with approval and held as follows:-
"The respondent must in a suit for specific performance of an agreement plead and prove that he was ready and willing to perform his part of the contract continuously between the date of the contract and tike date of hearing of the suit."
31. The ruling of Supreme Court in International Contractors Ltd. (9 supra) does not help Babu Rao. That was a case of sale with an agreement to repurchase. When the vendor offered to repurchase, the purchaser repudiated the agreement to reconvey. The Supreme Court described that repudiation as "a complete repudiation of the contract to reconvey" and held that as the appellant had repudiated the contract and had thus failed to carry out his party of the contract it was open to the respondent to sue for its enforcement. The Supreme Court then repelled the contention advanced on behalf of the purchaser that the vendor did not tender the price nor was he in a position to do so and that therefore the vendor was not entitled to get a decree for specific performance holding as follows:-
"In cases of this kind no question of formal tender of the amount to be paid arises and the question to be decided is not whether any money was within the power of the respondent but whether the appellant definitely and unequivocally refused to carry out his part of the contract and intimated that money will be refused if tendered. The principle laid down in Hunter v. Daniel, (1845) 4 Hare 420 is applicable to cases of this kind. In that case Wigram, V.C., stated the position as follows:-
'The practice of the Court is not to require a party to make a formal tender where from the facts stated in the Bill or from the evidence it appears the tender would have been a mere form and that the party to whom it was made would have refused to accept the money'."
The judgment of the Supreme Court in mat case shows that the vendor's solicitor in fact sent to the purchaser a draft conveyance for approval and also addressed a letter to the purchaser that the vendor was very eager to complete the purchase and that the full consideration money was lying idle in his hands awaiting returm of the relative draft conveyance as approved on purchaser's behalf. To this the solicitors of the purchaser replied that their client denied that there was any concluded or valid agreement for sale. It was on those facts, that the Supreme Court held that there was no need for formal tender of the amount when it became known that money would be refused if tendered. It has to be noticed here that the word 'repudiation', as observed by Lord Wright in Heyman v. Darwins LD (12 supra) "is an ambiguous word constantly used without precise definition in contract law". The learned Law Lord illustrated the different meanings of that word as follows:-
"Repudiation of a contract is sometimes used as meaning that the defendant denies that there ever was a contract in the sense of an actual consensus ad idem............Short of this, one party, though not denying that there was the appearance of assent, might claim that the consent was vitiated by fraud or duress or mistake or illegality, and in that sense it is often said that he repudiates the contract.........There is, however, a form of repudiation where the party who repudiates does not deny that a contract was intended bewteen the parties, but claims that it is not binding because of the failure of some condition or the infringement of some duty fundamental to the enforceability of the contract, it being expressly provided by the contract that the failure of condition or the breach of duty should invalidate the contract............ Another case to which the word repudiation is applied is when the party, though not disputing the contract, declares unequevocally that he will not perform it and, admitting the breach, leaves the other party to claim damages........... But perhaps the commonest application of the word 'repudiation' is to what is often called the anticipatory breach of a contract where the party by words or conduct evinces an intention no longer to be bound and the other party accepts the repudiation and rescinds the contract. In such a case, if the repudiation is wrongul and the rescission is rightful, the contract is ended by the rescission but only as far asconcerns future performance. It remains alive for the awarding of damages either for previous breaches or for the breach which constitutes the repudiation."
It is in the context of these different kinds of repudiation of contract by one party that the conduct of the other party not accepting the repudiation has to be examined as regards his performance of his part of the contract. A Division Bench of this Court in P. Lazarus v. Johnson Edward, AIR 1976 A.P. 243, considered the effect: and import of the decision of the Supreme Court in International Contractors Ltd. (9 supra) and held as follows:-
"We do not read this decision as holding that wherever there is a repudiation of the contract, it is not necessary for the plaintiff to perform all the terms of the agreement which he has to perform before he can call upon the other party to perform his contract. All that this decision says is that as the contract itself has been repudiated, any tender of the purchase price would only be an empty formality, and, therefore, there was no need for the plaintiff to tender the amount, for it was clear that even if tendered it would have been refused.........
xxxx xxxx xxxx ... .... The Supreme Court had nowhere stated in International Contractors Ltd. v. Prasanta Kumar that when the contract is repudiated by the vendor the purchaser is relieved of performance of the contract. The only question was whether in the circumstances of that case, actual tender of the pruchase price was necessary; and it was held that it was not, as that would be a mere formality as it was bound to be refused."
32. The learned Subordinate Judge in the present case did not examine the evidence on record and the facts found thereon keeping the above principles of law in view. He got himself lost about the thickets of contentions and plethora of citations and wondered around without having any clear bearings. Reading his judgment, I found it difficult to extricate his findings and conclusions from the various contentions adumbrated by him in paragraph after paragraph.
33. I am of the view that it is not necessary in this case to consider whether are repudiation of Ex. B-10 agreement by defendants 1 to 8 is valid and justified. It is clear that Babu Rao did not acept the repudiation and did not rescind the contract. He opted to keep alive the contract and sought the equitable remedy of the specific performance of the contract. It is therefore incumbent on him to establish that he performed his part of Ex. B-10 agreement as agreed to by him.
34. It is not in dispute that under Ex. B-10 he agreed to pay Rs. 20,000/- by 29-9-1979 and also to discharge the debts to be specified by defendants 1 to 8 and obtain vouchers from the creditors. Even according to Babu Rao, he paid only Rs. 5,000/- on 10-9-1979 and did not pay the balance of Rs. 15,000/- by 29-9-1979. Even by 28-11-1979 he only paid a further sum of Rs. 4,000/- i.e., in all Rs. 9,000/-. According to him he also paid a further sum of Rs. 5,000/- on the night of 18-3-1980, but he did not take any receipt for it. No attempt had been made to prove this payment and in the plaint he stated that he would pay this sum "if for any reason the payment of Rs. 5,000/- on 18-3-1980...... is not proved'. As regards the balance of Rs. 15,000/-, which was to be paid by him by 29-9-1979, the stand taken by Babu Rao in the plaint is that he was ready to pay the balance of Rs. 15,000/- also" but the defendant No.l said that the plaintiff might pay the amount to the creditors to be mentioned by him" and in spite of the plaintiff requesting defendants 1 to 8 to specify the particulars of the creditors whose debts were to be discharged, the defendants did not care to do so in spite of his repeated requests on the pretext that they would do so after obtaining permission from the urban land ceiling authority, etc. Thus, Babu Rao sought to strike two birds with one stone. This explanation also purports to give the reason for his not paying the creditors of defendants 1 to 8 as undertaken by him, from out of the balance consideration remaining after making the payment of Rs. 20,000/- by 29-9-1979.
35. But Babu Rao did not adduce any evidence whatsoever to establish his claim firstly that he was ready to pay the balance of Rs. 15,000/- by 29-9-1979 and secondly mat he did not pay the said balance only because the 1 st defendant told him that he should pay the same to the creditors to be mentioned by him. He did not produce any documentary evidence in support of these pleas. In respect of the payment of Rs. 5,000/- made by him on 10-9-1979, he took an endorsement marked as Ex. B-l1 on Ex. B-10 itself from defendants 1 to 8. In that it is stated that "having felt the necessity of funds when first party (defendants 1 to 8) requested second party (Babu Rao) to make payment of Rs. 5,000/- (Rupees Five Thousands only) towards part payment of sale consideration under sale agreement entered, the second party today paid the said sum to the first party........". In Exs. B-12 to B-14 receipts for the payments made by Babu Rao to defendants 1 to 8 of Rs. 2,000/-, Rs. l,000/-and Rs. l,000/-on 30-10-1979, 17-11-1979 and 28-11-1979 respectively, it is stated that the said amounts were received towards part payment of sale consideration. It is not stated in any of these receipts that Babu Rao was ready and willing to pay the entire balance amount of Rs. 15,000/ - but defendants 1 to 8 did not want the full amount to be paid to them and that the balance amount should be paid to the creditors. If really Babu Rao was ready and willing to pay the entire balance amount of Rs. 15,000/- and he did not pay the same because defendants 1 to 8 asked him to pay it to the creditors, it is incomprehensible why he did not have the same endorsed on any of these receipts taken by him after 29-9-1979. These receipts clearly show that defendants 1 to 8 were very much in need of money and it is inconceivable mat when Babu Rao offered to pay the entire balance amount of Rs. 15,000/- on or about 29-9-1979, defendants 1 to 8 asked him to retain the same for payment to the creditors. If that was the fact and if really the anxiety of defendants 1 to 8 was to have the said amount paid to the creditors by Babu Rao himself and not by themselves, it is well-nigh impossible to believe that defendants 1 to 8 did not give the names of the creditors whose debts had to be discharged especially when Ex. B-10 agreement itself recited that the plaint schedule property was offered for sale by defendants 1 to 8 "for discharging the debts contracted by the first party". Even in his evidence as D.W. 1 Babu Rao was silent on this part of his case. In his examination-in-chief he stated as follows:-
"I paid Rs. 5,000/- under endorsement Ex. B-11. It was signed by D-l to D-8. I was ready with the balance of Rs. 15,000/- payable as per Ex. B-10. As D- l told me that he would tell the names of debtors (creditors?) to whom the moneys have to be paid, I was waiting. Later at the request of D-l I paid Rs. 2,000/-, Rs. 1,000/- and Rs. 1,000/- at different dates evidenced under Exs. B.12 to B-14."
He did not say here that the 1st defendant asked him not to pay Rs. 15,000/- and that the lst defendant wanted that amount to be paid to his creditors. Hail to see the need for the 1st defendant to ask Babu Rao to do so when Ex. B-10 already provided that out of the balance of the consideration i.e., after paying the said Rs. 20,000/- on or before 29-9-1979, Babu Rao should discharge the debts to be specified by defendants 1 to 8 and obtain vouchers from the creditors, and that he should pay the balance remaining to defendants 1 to 8 before the Sub Registrar at the time of registration of the sale deed to be executed by defendants 1 to 8 - ample provision was made thus for the discharge of the debts due from out of the balance remaining after the payment of the said Rs. 20,000/- to defendants 1 to 8 on or before 29-9-1979. On the other hand, payments in driblets of Rs. 2,000/- and Rs.l,000/-by Babu Raoafter 29-9-1979 probablise the contrary - that Babu Rao was not willing to pay the balance of Rs. 15,000/- to defendants 1 to 8 as agreed to by him and that the 1st defendant had to squeeze out dribbles of it from him. It has also to be noticed that in his cross-examination Babu Rao admitted that there was a condition in Ex. B-10 that he had to pay Rs. 20,000/- on or before 29-9-1979 i.e., within two months of execution of Ex. B-10. He then stated:
"I paid Rs. 20,000/- on the date of Ex. B-10. I agreed to pay the remaining balance within one month of the permission from urban ceiling authority."
This is a totally inconsistent statement and wholly unsupported by anything in Ex. B-10. Thereafter, he also stated:
"Since D-l did not ask me I did not pay Rs. 11,000/- remaining due as on 29-9-1979. It is not true to suggest that I have to pay Rs. 20,000/- by 29-9-1979 even without D-l demanding or asking about it. It is not true to suggest that I have no capacity nor I had the said amount by then. I did not pay."
This is also a stand not supported by anything in Ex. B-10. This reason was not given in the plaint. In view of these shifting stands, the evidence of Babu Rao becomes unreliable and loses credibility. The 1st defendant as D. W 2 has stated in his examination-in-chief that there was no stipulation that he had to furnish list of creditors before the second payment of Rs. 20,000/- and that D.W.I did not pay Rs. 20,000/- as stipulated. He also stated that D.W. 1 never offered him Rs. 15,000/-nor he refused to take it. In the cross-examination on behalf of Babu Rao, after admitting the payment of Rs. 5,000/- made by Babu Rao before 29-9-1979 and also Rs. 4,000/- in three instalments of Rs. 2,000/-, Rs. 1,000/- and Rs. 1,000/- after 29-9-1979, D. W. 2 stated that he protested for such piecemeal payment and that he did not issue any notice. Thereafter, he stated, obviously in answer to a suggestion, as follows:-
"It is not true to suggest that I represented D.W.I to pay the amount only or discharge the debt whenever I demand it as the expenses for the family was mounting."
There is no reason to disbelieve the evidence of D.W. 2. What makes this part of the case of Babu Rao wholly suspect and wholly incredible is that Babu Rao had not stated when he offered to pay the balance sum of Rs. 15,000 / - and when he was told by the 1st defendant that he should pay that amount also to the creditors. There is no reliable evidence whatsoever to establish that Babu Rao offered to pay the balance sum of Rs. 15,000/- on or after 29-9-1979. I am therefore inclined to take the view that Babu Rao was not speaking the truth when he said that he was ready and willing to pay the balance of Rs. 15,000/- agreed to be paid by him by 29-9-1979 to defendants 1 to 8 and that he came up with a false plea that defendants 1 to 8 asked him not to pay the said amount and asked him to pay the said amount to their creditors.
36. The learned Subordinate Judge was not right in explaining away the non- payment of the balance sum of Rs. 15,000 / - by Babu Rao and the stand of Babu Rao in this regard on the basis that defendants 1 to 8 did not demand payment of the said amount by way of a notice in writing. Babu Rao himself had not thought fit to give that as an excuse. The learned Subordinate Judge also failed to see that the question was not whether defendants 1 to 8 were right in repudiating the contract-in fact they did not repudiate the contract because Babu Rao failed to pay the said balance sum of Rs. 15,000/- by 29-9-1979. The question of time being the essence of the contract is also not relevant.
37. The question is whether Babu Rao performed his part of the contract as undertaken by him under Ex. B-10 and if he did not do so, whether he is entitled to the relief of specific performance of the contract. In answering this question, it has to be kept in view that Babu Rao not merely agreed to pay Rs. 20,000/- by 29-9-1979, but he also agreed to discharge the debts due to the creditors of defendants 1 to 8 before calling upon defendants 1 to 8 to execute the sale deed. As Ex. B-10 reads, the performance of these obligations by Babu Rao were not hedged by any pre-conditions. I have already dealt with the failure of Babu Rao in making the payment of the balance sum of Rs. 15,000/- by 29-9-1979, or even thereafter. As regards the non-payment to the creditors, the plea of Babu Rao is that he was asking defendants 1 to 8 to specify the particulars of the creditors whose debts were to be discharged but defendants 1 to 8 did not care to do so in spite of his repeated requests "on the pretext that they would do so after obtaining the permission from the urban land ceiling authority. ...". D.W. 1 states in his examination-in-chief that he demanded the listof D-1'screditors so that he could discharge the debts and that D-l did not give any list nor revealed the names of his creditors. He did not state in his examination-in-chief that defendants 1 to 8 at any time stated to him that they would give the list of creditors after obtaining the permission from the urban land ceiling author i ties. On the other hand, in his cross-examination on behalf of the 1st defendant, he stated:
"I paid Rs. 20,000/- on the date of Ex. B-10. I agreed to pay the remaining balance within one month of the permission from urban ceiling authority."
He also stated that even though he was having amount, since D-l did not furnish list of creditors, he did not pay the second instalment i.e., Rs. 20,000/- In his cross-examination, he also admitted that he did not issue any registered notice to D-l to furnish details of debts. No suggestion was put to D.W. 2 in corss-examination on behalf of Babu Rao that he was repeatedly asked for the list of creditors or that he stated that he would give the list of creditors after obtaining permission from the urban land ceiling authority. In the cross- examination on behalf of Babu Rao, D.W.2 stated as follows:-
"I do not know if D.W. 1 is aware of the debts due by me. I did not prepare any list of the creditors since there are only 2 to 3 debts by the date of Ex. A-10 (B-10 ?). I have to discharge only debts to a tune of Rs. 40,000/-
xxxx xxxx xxxx It is true that there is stipulation that I have to mention the names of creditors to D.W. 1 and D.W. 1 is to discharge it. This is before the registration. As per the terms of the agreement, the sale is to be registered only after the discharge of debts by D.W. 1. Since D.W.I had no money I never told D.W.I the names of creditors."
There is no reason to disbelieve this evidence of D.W. 2. This falsifies the plea taken by Babu Rao that he w.?s repeatedly asking the 1st defendant for the names of the creditors and that the 1st defendant stated that he would give the list of creditors after obtaining the permission from the urban land ceiling authority. On the other hand, it is possible that at that time an impression was given to the 1st defendant that Babu Rao was not having ready money with him for payment of the balance sum of Rs. 15,000/- agreed to be paid by 29-9-1979 and also the amounts due to the creditors and that therefore the 1st defendant thought that it was futile to give the list of creditors when he was being paid only small amounts of that balance of Rs. 15,000/- on his repeated requests. It may be that Babu Rao was even then capable of raising monies. But he had not adduced any evidence to establish that he was willing to fulfil his obligation under Ex. B-10 as undertaken by him. If really he was repeatedly asking for the list of creditors without any result, nothing prevented him from giving notice to defendants 1 to 8 demanding the list of creditors or information as to the amount due to the creditors so that he could pay the amount straight to the 1st defendant himself for making payments to the creditors. Babu Rao has also not stated when he asked for the list of creditors because, according to him, even as regards the balance amount of Rs. 15,000/- he was asked to pay the to the creditors. He did not also state when he was so asked. On the basis of the evidence on "record, I am therefore satisfied that Babu Rao has not established his readiness and willingness to perform his part of Ex. B-10 agreement as undertaken by him and that on the facts and circumstances of the case, he is not entitled to the relief of specific performance claimed by him.
38. I am supported in this view by clear authority. In Raghavaiah v. Venkatasubrahmanya Siddanti,1955 (1)An.W.R.609. Satyanarayana Rao J., held that a person suing for specific performance of a contract must show his continuous readiness and willingness to perform the contract from the date of the contract to the time of the hearing, which meant:
"..that he should not only be ready but also willing. If he is ready but not willing or if he is willing but not ready, in that event, the suit must be dismissed."
In Gomathinayagatn Pillai v. Palaniswami Nadar (14 supra) the Supreme Court held:
"But the respondent has claimed a decree for specific performance and it is for him to establish that he was, since the date of the contract, continuously ready and willing to perform his part of the contract. If he fails to do so, his claim for specific performance must fail."
In Sandhya Rani v. Sudha Rani, , even when time was not the essence of the contract, the Supreme Court held as follows:-
"It is undoubtedly true that the High Court has recorded a finding (p. 32) that time was not the essence of the contract nor was it made essence of the contract by a specific notice, but it is equally true that the plaintiff seeks relief for specific performance of contract and it is incumbent upon the plaintiff to affirmatively establish that all throughout he or she, as the case may be, was willing to perform his or her part of the contract, and that the failure on the part of the plaintiff to perform the contract or willingness to perform her part of the contract may in an appropriate case disentitle her to relief, one such situation being where there is inordinate delay on the part of the plaintiff to perform his or her part of the contract.........".
Mere assertion of readiness and willingness is not enough if there was no conduct supporting the same. (See Chand Rani v. Kamal Rani, .).
39. In P. Lazarus v. Johnson Edward (15 supra) the consideration fixed under the agreement to sell dated 5-10-1966 was Rs. 48,000/-. On the date of agreement, an advance of Rs. 5,000/- was paid. The agreement recited that the sale was being effected by the vendor for the purpose of discharging his debts. The purchaser was asked to discharge a mortgage debt of Rs. 12,000/- and also certain sundry debts owing to several creditors. After discharging those debts, the balance amount of sale consideration was to be paid to the vendor at the time of registration of the sale deed. The stand taken by the purchaser was that the vendor was requested to give a list of the creditors but he evaded and dragged on the matter. A Division Bench of this Court held in that case as follows:-
"...... It was clearly stated in the agreement that the plaintiff (the purchaser) should discharge the mortgage debts and other sundry debts. It was, therefore the plaintiff's duty either to have paid the amount to the 1st defendant (the vendor) and asked him to discharge the debts or to have ascertained the names of the creditors from the 1st defendant and discharge the debts himself. He has not chosen to do either. Even if the defendant did not furnish him a list of the creditors the plaintiff should have called upon him to furnish such a list or in the event of his refusing to do so, he should have tendered the money to the 1st defendant so that the 1st defendant may discharge the debts himself. But the plaintiff kept quiet for more than one year..........The Court below was therefore, right in holding that the plaintiff did not perform his part of the contract under Ex. A-l and was not entitled to claim specific performance of the contract".
This ruling applies directly to the facts of the present case and supports the view I have taken.
40. The next question is whether Babu Rao has to be denied the equitable relief of specific performance on the ground that he did not come to the Court with clean hands. Mr. J.V. Suryanarayana Rao took me to old English decisions and contends that principles laid are sound and valid even today. He refers me to Hayes v. Caryll, 1702 I.E.R. 462., wherein it was held that:-
"Where one party to an agreement trifles, or shews a backwardness in performing his part of it, equity will not decree a specific performance in his favour; especially, if the circumstances and situation of the other party are materially altered in the mean time."
He also relied on the following passage in Cox v. Middleton , 1854,61 E.R. 699.
"But this is a suit for specific performance; and in such a suit it is not an answer to the fact of the Plaintiff having made false representations to say, the Defendant was imprudent. If the case stood only this ground only, I should refuse specific performance. If a Plaintiff comes here and asks relief: asks this Court (High Court of Chancery) to assist him in what is not the assertion of a strict legal right, but to assist him on grounds standing on the peculiar jurisdiction of this Court, he must shew that his conduct has been clear, honorable and fair."
He also referred to the following passage in Hanbury & Maudsley's Modern Equity (Thirteenth Edition, 1989, Page 676):-
"A plaintiff must come to equity with dean hands. Before specific performance can be decreed in his favour, he must show that he has performed all his own obligations under the contract, or has tendered performance, or is ready and willing to perform them.......... If both parties have 'unclean hands' there is no question of balancing the misconduct of the one against that of the other. The 'clean hands' defence is concerned with the conduct of the plaintiff alone, although all the circumstances, including the conduct of the defendant, are relevant to the exercise of the discretion."
And also to the passage in Snell's Principles of Equity (Twenty-Eighth Edition, 1982, Page 594):-
"Even if there is no fraud or mis-representation sufficient to justify the rescission of the contract, the Court may still refuse the equitable remedy of specific performance if the conduct of the plaintiff has been tricky or unfair, for 'he who comes into equity must come with clean hands,' and the court is not bound to decree specific performance in every case in which it will not set aside the contract."
41. However, what are more relevant and binding on me are the decisions of this Court in K. Venkata Subbayya v. K. Venkateswarlu, ., and M.N. Mohammad Mirza v. B. Subhan Saheb, . In K. Venkatasubbyya's case, ., a learned Single Judge of this Court held as follows:-
"The statement that he (plaintiff) had already paid Rs. 1500/- has now been found to be not true by both the courts and that finding of fact cannot be disturbed............That being so, it must be taken that the averment in the plaint that he had paid a sum of Rupees 1500/- on 14-10-1960 is not true.......... the plaintiff who seeks equitable remedy of specific performance must come to the court with clean hands. As held by a Division Bench of the Madras High Court in Subbarayudu v. Tatayya (1937 Mad. WN 1158) that where the plaintiff seeking the relief of specific performance puts forth a false plea, he would be disentitled to the equitable and justifiable relief of specific performance."
In M.N. Mohammad Mirza's case, ., a Division Bench of this Court held as follows:-
"When Ex. A-l the foundation of the suit contains an endorsement Ex. A-l (a) in the handwriting of the respondent, by which the appellant purported to have extended the time for performance of the contract, although it does not bear his signature, it was the bounden duty of the respondent to aver in the plaint, the circumstances under which the endorsement was written by him especially after the assertion of the appellant's advocate in the reply notice Ex. A-3 that the appellant declined to accede to the request of the respondent to extend time for performance of the contract. By suppressing this vital fact, the respondent came up with a false case.
xxxx xxxx xxxx It is thus clear that on vital and important aspects the plaintiffs case is false and equally false is his testimony as P.W. 1. He came to the Court with unclean hands. He is, therefore, not entitled to the equitable relief of specific performance under Section 20 of the Act, (Specific Relief Act, 1963)."
42. I have already found that Babu Rao came up with a false case that he did not pay the balance of Rs. 15,000/- payable by 29-9-1979 only because the first defendant told him that he should pay the same to the creditors to be mentioned by him. There was absolutely no evidence in support of this plea. He had not stated when he was told that he should pay that amount also to the creditors. There is nothing to show that he ever offered to pay the balance of Rs. 15,000/- on or even after 29-9-1979. In his cross-examination, he equivocated stating at one point that it was not true that he had to pay Rs. 20,000/- by 29-9-1979 even without the 1st defendant demanding or asking about it; and then again stating that he agreed to pay the remaining balance within one month of the permission from the Urban Ceiling Authority. This obviously shows that Babu Rao's conduct was not clear, honourable and fair and that he is unreliable. His plea that he paid a further sum of Rs. 5,000/- on the night of 18-3-1980 has to be looked at in this back-ground. It is impossible to believe that he could not take any receipt for it. He had not made any attempt to adduce any evidence to prove this payment. It is significant that this was stated for the first time in Ex. B-17 reply notice dated 25-4-1980 by Babu Rao's advocate to the 1st defendant's advocate as follows:-
"On the night of 18-3-1980 your client No. 1 (the 1 st defendant) came to my client's house and requested for payment of Rs. 5,000/- representing that the property taxes have to be paid to the Municipality and Municipal Servants have come and are threatening to destrain his property and that it should be immediately paid and the amount of Rs. 5,000/- would be taken as further advance under the said agreement of sale. The amount was paid by my client to your client No. 1. Your client went away in a hurry without giving receipt."
Ex. B-17 was given in reply to Ex. B-16 notice dated 3-4-1980 by the advocate of defendants 1 to 8 to Babu Rao. Therein, at the outset itself it was stated:-
"On behalf of my clients, I have already issued a registered notice dated 4-2-1980 to you and you have evaded the notice wilfully and it was returned unserved. I am herewith enclosing a true copy of the said notice issued to you on 4-2-1980 for your information. The sum and substance of the said notice is as follows.......
.........The said Authority (Urban Land Ceiling/Competent Authority, Vijayawada), to your knowledge, granted permission only for the sale of 696 sq. meters the area covered by the Mill and its appurtenant site. In respect of the remaining extent the permission was refused. As the permission of the said Authority is the condition precedent for the fulfilment of the contract and as the said Authority has not granted permission for the sale as requested by my clients in respect of the full site covered by the agreement of sale, the performance of the contract become impossible and therefore the agreement of sale was conceited automatically and my clients made a fresh offer in respect of the site and Mill for which the permission was granted one week's time was given to you to avail the opportunity for entering into a fresh agreement of sale in respect of the Mill and site for which permission was granted. After you evaded the notice you met the first of my clients and he told you about the said notice and your wilfully evasion and told you also that the offer given to you was no more available and my clients are proceeding with the sale of the said site and the Mill to third party. It is hereby informed that the previous agreement of sale dated 29-7-1979 came to an end."
The unopened returned registered notice dated 4-2-1980 was marked as Ex.B-24; a copy of the said notice was marked as Ex. B-23. Thus, according to Babu Rao, the 1st defendant approached him after Ex. B-23 registered notice dated 4-2-1980 was sent and was returned unserved. As per the postal endorsement made on Ex. B-24, it is seen that it was returned in February itself. Thereafter, telegram dated 2-4-1980 evidenced by Ex. B-15 was sent by the 1st defendant to Babu Rao. It is therefore, hard to believe that the 1st defendant went to Babu Rao on the night of 18-3.-1980 for Rs. 5,000/- after he got issued Ex. B-23 notice by registered post. What is stated in paragraph 8 of the plaint in O.S. No. 248 of 1981 is the same as what was stated in Ex. B-17 notice dated 25-4-1980. However, in his examination in chief, Babu Rao (D.W. 1) states:-
"I also lent Rs. 5,000/- as hand loan to D-l. I agree to deposit the balance of sale consideration including Rs. 5,000/- given by me towards hand loan if D-l denies it." This is contrary to what is stated in Ex. B-17 and in paragraph 8 of the plaint in O.S. No. 248 of 1981 wherein it is stated that "Rs. 5,000/- would be taken as further advance under the said agreement of sale". On 30-11-1987, in the cross-examination on behalf of the 1st defendant, Babu Rao states:
" Since D-l did not ask me I did not pay Rs. 11,000/- remaining due as on 29-9-1979......."
Again, on 11-12-1987, when he was cross-examined, he states:
"As D-l asked urgently to pay Rs. 5,000/-1 paid. It was after Ex. B-14. (Receipt dated 28-11-1979 for Rs. 1,000/-). This amount was not mentioned in notices. I gave up the said amount. I did not mention it in my account.
The payments made in Exs. B-l1 to B-14 are shown in my accounts......."
The 1st defendant as D.W. 2 has stated in his examination-in-chief that D.W. 1 (Babu Rao) did not pay Rs. 5,000/- in March and that D.W. 1 never offered to pay him Rs. 15,000/-. He was not cross-examined on this on behalf of Babu Rao. It therefore follows that the case set up by Babu Rao as regards his payment of Rs. 5,000/- on 18-3-1980 is utterly false. Equally false is the case set up by him that the 1st defendant asked him to pay to the creditors the balance of Rs. 20,000/- that he had to pay by 29-9-1979.
43. Thus, Babu Rao came up with an utterly false case in an attempt to explain away his non-payment of the balance remaining out of Rs. 20,000/- which he had undertaken to pay by 29-9-1979. He had also not come forward to pay the amounts payable to the creditors by requiring the 1st defendant to give the list of creditors together with the amounts payable to them or in the alternative by tendering to the 1st defendant himself the amounts due and payable to his creditors. He himself has stated in the plaint that "for the purpose of discharging their debts, the defendants 1 to 8 put up the schedule property for sale.............". Admittedly he had not given any notice to the 1st defendant requiring him to give the list of creditors and the amounts payable to them. Under Ex. B-10 agreement, the obligation of making these payments is not hedged by any conditions. In view of these false stands taken up by Babu Rao in an attempt to explain away to non-payment of the said amounts, I am not inclined to grant him the equitable relief of specific performance of Ex. B-10 agreement.
44. In this connection, it has also to be kept in view that Babu Rao was doing business in real estate at the relevant time. He had number of agreements on his hand and instituted number of suits for specific performance. He himself admitted that he was dealing in real estate business since 1976 (in his cross- examination on behalf of D-2 to D-8 on 19-9-1988). He filed O.S. No. 562 of 1982 for specific performance of agreement of sale dated 1-11-1981 for a total consideration of Rs. 4,90,000/-. Ex. B-29 is a copy of the plaint in the said suit and in that he states that he is a real estate dealer and that he purchases lands and sells them in small plots at higher price for profits. Similarly, he filed O.S. No. 104 of 1982, O.S. No. 460 of 1985 and O.S. No. 458 of 1985, all on the file of the learned Subordinate Judge's Court at Vijayawada for specific performance of various agreements of sale in his favour. Thus, he is a litigious person. In his examination in chief on 3-11-1987, he stated that in fact he deposited a sum of Rs. 1,25,000/- in Indian Bank by the date of the present suit OS. No. 248 of 1981 i.e., 14-5-1981. In his cross-examination on the same day also, he stated that he deposited Rs. one lakh and odd only in Indian Bank and that he had no other bank account. In his cross-examination on 11-12-1987, he stated:
"Only for this transaction, I opened the account in the Indian Bank. I did not with draw amount of Rs. 20,000/-when it was given to D-1. It was with me in the house.
xxxx xxxx xxxx I did not file pass book to show that the amount is deposited in Bank. It was earned by me for my business. My accounts will reveal it. It is not true to suggest that I did not deposit in courts. Rs. 1,25,000/- deposited by me in the Indian Bank was withdrawn by me within one year of deposit."
On his application for recalling himself for further examination, Babu Rao was examined on 5-4-1988 and in his examination-in-chief, he stated:-
"I am filing pass books of savings Bank Account in Central Bank, Indian Bank evidenced under Exs. B-33 and B-34 respectively. I am also filing certificate Ex. B-35 showing the amount till today."
Ex. B-33 is the pass book in respect of Savings Bank Account No. 1574 of Babu Rao and Potluri Annapurna in Benz Circle Branch, Vijayawada of Central Bank of India. Ex. B-34 is the pass book in respect of Savings Bank Account No. 3766 of Babu Rao in Vijayawada-1 Branch of Indian Bank. It was opened on 10-1-1988. Ex. B-35 is a certificate of balance dated 22-3-1988 given by the Governorpet branch of Indian Bank certifying that "the balance that stood at Credit/Debit in the SB 10525 account of Mr. P.Babu Rao with us as at close of business on 22-3-88 was Rs. 1,25,000/- (Rupees One Lakh twenty five thousand only)". In his cross-examination on 5-4-1988, he stated as follows:-
"On 7th March 1980 I deposited Rs. 1 lakh. On 13-3-80 I deposited Rs. 25,000/-. On 26-3-19801 withdrew Rs. 20,000/-. On 8-6-801 withdrew Rs. 1,05,000/-. By June 1980 there was a balance of Rs. 2215/-.
I did not make any further credits in Ex. B-34 subsequently.
I also withdrew interest accrued by December 1983 and leaving a balance of Rs. 0.58.
I deposited the amount pertaining to this suit in Indian Bank only.
By the end of 1980 there was a balance of Rs. 100.17 in Ex. B-33.
The last balance amount shown is Rs. 8.31.
It is not true to suggest that to show that I am having account I got amount somewhere deposited in the account and later withdrew. It is not true to suggest that all these make believe entries only to suit the contention taken in the plaint.
I did not deposit the amount withdrawn by me in June 1980, shown in Ex.B-34, in any other Bank.
It is not true to suggest that I was never ready with the money".
This evidence clearly establishes that though on 13-3-1980 Babu Rao had Rs. 1,25,215-73 in his Savings Bank Account No. 3766 in Vijayawada-1 branch of Indian Bank as per Ex. B-34, on 26-3-1980 itself he withdrew Rs. 20,000/- and therefore as on the date when he filed the suit i.e., 14-5-1981, he had only Rs. 1,05,215-73 in the said account. This falsifies the plea taken in paragraph 19 of the plaint that: "the plaintiff has Rs. 1,25,000/- (Rupees One Lakh twenty five thousands only) to his credit in Indian Bank under Account No. 3766". It is significant that soon after the institution of the present suit, Babu Rao withdrew on 8-6-1980 Rs. 1,05,000/- from this account leaving only a balance of Rs. 215-73 - not Rs. 2,215 /- as stated by him in his evidence. The account never exceeded Rs. 1,000/- thereafter till 24-8-1983 when it momentarily went upto about Rs. 1,800/-. He withdrew Rs. 1200/- on 26-8-1983 and Rs. 600/- on 12-104983 and thereafter it never exceeded Rs. 30/-. All this brings out Babu Rao in poor light and further establishes that he had not come to the Court truth-fully and with clean hands. He has no doubt filed Ex. B-35 showing that his Savings Bank Account No. 10525 in Indian Bank has a sum of Rs. 1,25,000/- as on 22-3-1988, but by that date at least three suits i.e., O.S.No. 562 of 1982 and O.S. Nos. 458 and 460 of 1985 on the file of the learned Subordinate Judge's Court at Vijayawada instituted by him for specific performance, are pending in which he had to pay more than Rs. 6.5 lakhs towards balance consideration under the respective agreements of sale sought to be specifically enforced.
45. In the view I have taken, it is not necessary for me to deal with the other contentions advanced in respect of this suit based on the order of the Special Officer and Competent Authority, Urban Land Ceiling, Vijayawada under Section 8 (4) of the U.L.C. Act in C.C. Nos. 1649 and 2577 to 2581 of 1976 dated 28-10-1980 (Ex. B-20), and on the Clause in Ex. B-l0 agreement that the sale deed has to be executed in the name of the nominee of Babu Rao and as no nominee was named, there could be no specific performance.
46. For the reasons stated above, A.S.No. 1211 of 1991 and A.S. No. 905 of 1994 are allowed with costs throughout. A.S. No. 765 of 1991 is dismissed without costs. In the result, the judgment and decree of the lower Court in O.S. No. 248 of 1981 are set aside and O.S. No. 248 of 1981 is dismissed except to the extent of refund of the part consideration paid. There shall be a decree to the plaintiff therein i.e., the 1st respondent in A.S. No. 1211 of 1991 and the respondentinA.S.No.905ofl994againstdefendantslto8forRs.29,000/-with interest at 12% per annum from the dates the various amounts totalling to Rs. 29,000/- were paid by the plaintiff to the 1st defendant, till realisation.
47. In the result, A.S. No. 1280 of 1991 preferred by defendants 9 and 10 in O.S. No. 248 of 1981 is dismissed without costs. However, it is made clear that the appellants in A.S. No. 1280 of 1991 are entitled to receive all the amounts that were deposited to the credit of O.S. No. 248 of 1981 pursuant to the order dated 31-12-1982 of the lower Court in LA. No. 5170 of 1982 preferred by the plaintiff in that suit and to the order of this Court in C.M.P. No. 12445 of 1983 dated 27-12-1983 pending CM.A. No. 740 of 1983 preferred against the said order dated 31-12-1982 by the 10th defendant in that suit, in view of the fact that the said suit is dismissed now.