Delhi District Court
Dr. Manav Rakshak vs M/S Civcon Engineering & Contracting Co on 8 September, 2017
IN THE COURT OF SH. POORAN CHAND, ADDITIONAL
DISTRICT JUDGE 06, SOUTHEAST DISTRICT, SAKET
COURTS, NEW DELHI
C.S No. 8533/16
1.Dr. Manav Rakshak, s/o Sh. Kul Rakshak, R/o 46, Deluxe Cooperative Group Housing Society, Plot No. B5, Vasundhara Enclave, New Delhi
2. Dr. (Mrs.) Gitanjali Gupta, W/o Dr. Manav Rakshak, R/o 46, Deluxe Cooperative Group Housing Society, Plot No. B5, Vasundhara Enclave, New Delhi .....Plaintiffs Versus
1. M/s Civcon Engineering & Contracting Co.
(India) Pvt. Ltd S11, Greater KailashII, New Delhi110048 Through its Director
2. Sh. Vikram Kumar s/o Sh. Tilak Raj Partner of M/s Dewan Chand C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 1 of 32 S11, Greater KailashII, New Delhi110048
3. M/s Dewan Chand Builders & Contractors, (a partnership Firm) through its partner Sh. Vikram Kumar S11, Greater Kailash, PartII, New Delhi110048
4. Sh. Akash Mohan Gupta, s/o Sh. Madan Mohan Gupta, 27A, Friends Colony (West), Mathura Road, New Delhi110065 .....Defendants Date of institution of case : 30.09.2004 Date of judgment reserved : 31.08.2017 Date of judgment pronounced : 08.09.2017 SUIT FOR SPECIFIC PERFORMANCE AND MANDATORY INJUNCTION J U D G M E N T
1. The plaintiffs filed the instant suit for specific performance and mandatory injunction qua first floor of property bearing no. 27A, Friends Colony (West), Mathura Road, New Delhi (hereinafter referred to as suit property). Defendant no.4 had entered C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 2 of 32 into a collaboration agreement dated 21.03.2000 with defendant no.1. The plaintiffs entered into an agreement to sell on 17.06.2003 with defendant no.1 for purchasing the suit property for a total consideration of Rs. 35 lacs. A separate construction agreement was also executed between the plaintiff and defendant no. 2 M/s Dewan Chand Builders & Contractors for carrying out the finishing job in the suit property for a total cost of Rs. 25 lacs.
2. It is averred that at the time of execution of agreement to sell, plaintiffs paid Rs. 2,50,000/ as part payment and the balance payment was to be made at the time of execution and registration of sale deed. The plaintiffs had also paid the sum of Rs. 7,50,000/ as an advance towards construction cost and the balance of Rs. 17.50 lacs was to be paid by the Corporation Bank, Sarita Vihar, New Delhi, the Bankers of the plaintiffs.
3. It is also averred that at the time of execution of both the agreements dated 17.06.2003 and 18.06.2003, the plaintiffs had paid Rs. 10 lacs with the understanding that the vacant and peaceful C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 3 of 32 possession of the first floor portion forming the part of 27A, Friends Colony (West), New Delhi after getting it completed in all respects would be handed over to the plaintiffs.
4. It is further averred that sometime in June, 2003, defendant no. 1 to 3 represented that the construction work in respect of the suit property was going to be completed and they are ready and prepared to get the sale deed executed very shortly. The defendant no.2 in the capacity of Director of defendant no.1 asked the plaintiffs to get the stamp papers purchased for the execution of sale deed in terms of the Agreement to Sell. Accordingly, plaintiffs purchased the stamp papers of Rs. 2,80,000/ for the purpose of execution of sale deed on the agreed sale price of Rs. 35 lacs. However, it was informed by defendant no.2 that since he has not been able to get the property transferred in his favour from the owner the defendant no.4, therefore, he would take some time to get the property transferred and conveyed.
5. It is further averred that plaintiffs had earlier got sanctioned loan facility to the extent of Rs. 50 lacs from Corporation C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 4 of 32 Bank for the purchase of the suit property and that the plaintiffs were and are ready and prepared with the balance sale consideration of Rs. 32.50 lacs and also the balance sum of Rs. 17.50 lacs towards the construction/furnishing the suit property.
6. Defendant no.2 in the capacity of Director of defendant no.1 could not give any satisfactory reply with regard to his title and further could not come out with the solution as to why defendant no.4 the owner of the property No. 27A, Friends Colony (West), New Delhi had not conveyed and transferred the portion of 470 sq. yards and as such defendant no.2 had failed to complete the construction work as agreed under the Principal Collaboration Agreement dated 21.03.2000 and therefore, the defendant no. 1 and 2 could not execute the sale deed in favour of the plaintiffs despite repeated demands and requests.
7. It is averred that defendants no.1 and 2 since had failed to perform their part of obligation and could not execute the sale deed in favour of plaintiffs and in order to avoid their responsibility, got C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 5 of 32 issued two letters dated 22.09.2003 addressed to the plaintiffs on behalf of defendant no.1 and another letter was issued under the signature of defendant no.2, as partner of M/s Dewan Chand Builders & Contractors on the false allegations. However, the defendants no.1 and 2 had omitted to annex the two cheques as mentioned in the said two letters. Consequently, a demand notice dated 16.10.2003 was got issued by the plaintiffs wherein the factum of not enclosing the cheques was mentioned and defendants were called upon to execute the sale deed as the plaintiffs were ready and willing to pay the balance amount. However, defendants no.1 and 2 failed to respond and rebut the said notice and as such the demand notice shall be deemed to have been admitted by the defendants.
8. It is also averred that on 16.11.2003, plaintiffs had visited the site and found that defendant no.4 had received the possession of the building falling to his share and had requested the defendants no.1 to 3 to execute the registered sale deed and hand over the vacant and peaceful possession of the first floor portion in favour of the plaintiffs C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 6 of 32 in terms of Agreement to Sell dated 17.06.2003 and Construction Agreement dated 18.06.2003 but they failed to respond favourably.
9. The defendants no. 1 to 3 have failed to perform their part of obligation despite repeated requests and service of the legal demand notice dated 16.10.2003, the plaintiffs have no option but to approach this Hon'ble Court seeking the relief of Specific Performance of the Agreement to Sell dated 17.06.2003.
10. The cause of action arose on 17.06.2003 when the agreement to sell was executed by the defendant no.1 through defendant no.2 and on 18.06.2003 when the defendant no.2 for and on behalf of partnership firm (deft no.3) had executed the construction agreement in the capacity of partner of defendant no.3. The cause of action further arose on 26.06.2003 when on the asking of defendants no.1 and 2, the plaintiffs had purchased the stamp papers of Rs. 2,80,000/ for getting the sale deed executed in terms of agreement to sell dated 17.06.2003. The cause of action further arose on 16.10.2003 when demand notice was got issued by the plaintiffs to the C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 7 of 32 defendants. The cause of action further arose on 16.11.2003 when the plaintiffs had visited the site and found that defendant no.4 had received the possession of the building falling to his share and had requested the defendants no.1 to 3 to execute the registered sale deed and hand over the vacant and peaceful possession of the first floor portion in favour of the plaintiffs in terms of Agreement to Sell dated 17.06.2003 and Construction Agreement dated 18.06.2003 and they failed to respond favourably. The cause of action is still continuing and subsisting.
Defendant's Version
11. The defendants were duly served and filed their written statements. In their written statements, defendants no.1 to 3 have taken preliminary objections that the suit deserves to be dismissed as plaintiffs have no cause of action in their favour. It is submitted that defendant no.1 vide its notice dated 22.09.2003 had terminated the Agreement to Sell dated 17.06.2003 and returned the advance amount of Rs. 2,50,000/ vide cheque no. 162281 for Rs. 1,25,000/ and C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 8 of 32 cheque No. 162282 for Rs. 1,25,000/, both drawn on Canara Bank as the refund of advance against the said flat received from the plaintiffs. Similarly, defendant no.3 vide another registered notice dated 22.09.2003 had also terminated the Construction Agreement dated 18.06.2003 and alongwith the same, enclosed cheque bearing no. 165877 for Rs. 3,75,000/ and cheque bearing No. 165878 drawn on Canara Bank towards refund of the advance amount received from the plaintiffs. Thus, there was no contract subsisting after the termination of the contracts on 22.09.2003, due to the defaults on part of the plaintiffs.
12. Another objection taken is that plaintiffs have suppressed material facts from this Court. It is stated that plaintiffs committed material breach of the terms of the agreements and did not make the payment of the balance sale consideration on time for execution of sale deed in their favour. It is submitted as per the specifications, the construction work was completed by the defendant no.3 on 24.06.2003 and the plaintiffs inspected the premises and were fully C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 9 of 32 satisfied with the work and plaintiffs also issued a "Full and Final Discharge Certificate" in favour of defendant no.3 certifying that the work carried out was in accordance with the construction agreement dated 18.06.2003. It was decided amongst the parties that the Sale Deed will be executed on 25.06.2003 and the plaintiffs will pay the balance sale consideration on the execution of the Sale Deed. However, on the morning of 25.06.2003, the plaintiffs did not come to the office of the SubRegistrar for execution of the Sale Deed and on enqiury gave evasive reasons for their failure. Thereafter, despite repeated requests, plaintiffs did not make the balance payment within the stipulated time knowing fully well that time was the essence of the aforesaid agreements.
13. It is also stated that after the termination of agreements dated 17.06.2003 and 18.06.2003 and after giving ample time to the plaintiffs, defendants sold the said flat to a third party and hence, no relief under the present suit can be granted to the plaintiffs as the property already stands sold to a third party, for valuable C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 10 of 32 consideration. The defendants no.1 to 3 have further denied all the averments made in the plaint by the plaintiff.
14. The defendant no.4 also filed his written statement. In his written statement, defendant no.4 has stated that defendant no.1 and 2 had failed to prove the various fixtures and fittings as agreed by them. It is further submitted that in terms of various specifications agreed between the parties, the builders had failed to complete the construction and accordingly the defendants no.1 and 2 were not competent to sell/convey any portion of their share of the portion constructed on the land measuring 470 sq. yards to any one. The registered power of attorney also provides similar restrictions fully contained in clauses 7 and 9 of the power of attorney and as the defendants no. 1 and 2 were not competent to avail the right for conveying through the registered power of attorney, therefore, the defendant no.4, cannot be presumed to have consented for the sale of any portion particularly the portions situated on the first and second floors.
C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 11 of 32
15. Thereafter, plaintiffs filed their replication to the W.S of defendant no.1 to 3 denying the allegations made in their written statements and reiterating and reaffirming the contents of the plaint. In their replication to the W.S of defendant no.4, it is submitted that even if the builders, the defendants no.1 and 2 have failed to complete the construction of rooms and bathrooms in the basement, the portion falling to the share of defendant no.4 and/or otherwise some of the fixtures and fittings have not been provided to the defendant no.4, even then the defendant no.4 being the actual owner, cannot escape his responsibility and ought to have come forward to pressurize the defendants no.1 and 2 to get the sale deed executed in favour of the plaintiffs.
Issues
16. After completion of pleadings, followings issues were framed.
1. Whether the plaintiffs were ready and willing to perform their part of the obligations arising from the agreement to sell dated 17th June, 2003 as well as the C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 12 of 32 construction agreement dated 18th June, 2003, if so, to what effect?OPP
2. Whether the agreement to sell as well as the construction agreement dated 17th and 18th June, 2003 respectively stand rescinded, as alleged in the written statement, if so, to what effect? OPD.
3. Relief.
Plaintiff's Evidence
17. In order to prove their case, plaintiffs have examined four witnesses. Plaintiff no.1 has examined himself as PW1. He tendered his examination in chief by way of affidavit which is Ex.PW1/A relying on various documents i.e the Collaboration Agreement dated 21.03.2000 is Ex.P1 and the General Power of Attorney dated 24.02.2000 is Ex.P2, Agreement to Sell dated 17.06.2003 is Ex.P3, Construction Agreement dated 18.06.2003 is Ex.P4, two letters dated 22.09.2013 are Ex.P5 and Ex.P6, copy of notice dated 16.10.2003 is Ex.P7, postal receipts are Ex.P8 to Ex.P13, A.D cards are Ex.P14 to Ex.P17. He has further reiterated the contents of the plaint in his C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 13 of 32 evidence affidavit.
18. PW2 Sh Amar Pal Singh is the official from Govt. Treasury, Tis Hazari, Delhi. He has proved the factum of purchasing the stamp papers worth Rs. 2,80,000/ by Manav Rakshak on 26.06.2003. The challan pass register showing the entry in this regard is Ex.PW2/1. Photocopy of stamp papers value of Rs. 2,80,000/ is Ex.PW2/2. The said stamp papers were received by Mr. Shiv Kumar after signing against the entry No. 5962, photocopy of said entry is Ex.PW2/3.
19. PW3 is the Dy. Manager from the UTI Bank, Branch Noida. He has proved the statement of account as per which a sum of Rs. 1,43,000/ was withdrawn in cash from the account of Manav Rakshak and Rs. 1,40,000/ was withdrawn from the account of Gitanjali Gupta. The statement of accounts duly certified under the Banker's Book of Evidence Act are Ex.PW3/1 and Ex.PW3/2 respectively.
20. PW4 is Sh. Adil, Manager Corporation Bank, Branch C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 14 of 32 Sarita Vihar, New Delhi. He deposed that plaintiffs had applied for loan for construction of house and purchase of the house which was sanctioned by the bank on 27.06.2003 to the extent of Rs. 50 lacs. This witness has brought the bankers cheque No. 43620 for Rs. 17.50 lacs and bankers cheque No. 243621 for Rs. 32.50 lacs. Same are Ex.PW4/1 and Ex.PW4/2 respectively. Both these bankers cheques were not got encashed and remained with the bank as the builders did not come to execute the sale deed in favour of the bank.
Defendant's Evidence
21. Defendants no.1 to 3 have examined only one witness to prove their case. Sh. Vikram Kumar, the director of defendant no.1 and 3 has examined himself as DW1. He tendered his examination in chief by way of affidavit wherein he has reiterated the contents of the written statement. Affidavit is Ex.DW1/A. He has relied on document i.e copy of sale deed in favour of Mr. N.K. Sawhney is annexed as mark X.
22. I have heard final arguments on behalf of both the sides. I C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 15 of 32 have also carefully perused the entire record and evidence led by both the sides and also have perused the case laws relied by them.
Finding on Issues Issue No.1:
Whether the plaintiffs were ready and willing to perform their part of the obligations arising from the agreement to sell dated 17th June, 2003 as well as the construction agreement dated 18th June, 2003, if so, to what effect?OPP
23. The onus of proving this issue was on the plaintiffs. The plaintiffs have argued that to perform their part of the agreement, they had got loan of Rs. 50/ lacs sanctioned from Corporation Bank. PW 2 has clearly deposed that plaintiffs had applied for loan for construction of house and purchase of the house which was sanctioned by the bank on 27.06.2003 to the extent of Rs. 50 lacs. This witness has proved the bankers cheque No. 43620 for Rs. 17.50 lacs as Ex.PW4/1 and bankers cheque No. 243621 for Rs. 32.50 lacs as Ex.PW4/2. Both these bankers cheques were not got encashed and remained with the bank as the builders did not come to execute the C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 16 of 32 sale deed in favour of the bank. Further, PW4 from Govt. Treasury, Tis Hazari, Delhi has proved the factum of purchasing the stamp papers worth Rs. 2,80,000/ by Manav Rakshak on 26.06.2003. The challan pass register showing the entry in this regard has been proved as Ex.PW2/1. It is further argued that despite their repeated asking for execution of the sale deed in their favour, defendant no.1 and 2 failed to give any satisfactory reply with regard to the transfer of suit property in favour of the plaintiffs. It is submitted that the willingness of the plaintiffs to perform their part of agreement is abundantly clear from the testimonies of PW2 and PW4.
24. It is also argued on behalf of plaintiffs that as per section 52 of Transfer of Property Act, the defendants were under obligation not to sell off the suit property till the pendency of the suit, however, defendants sold off the property while the suit with regard to the suit property was still pending and as such, the plaintiffs are protected u/s 52 of Transfer of Property Act and are entitled to the reliefs as claimed in the present suit.
C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 17 of 32
25. It is further argued that the plaintiffs were ready and willing through out to make the payment of balance sale consideration and in order to show their willingness, they have enclosed cheque of Rs. 50 lacs in favour of this Court alongwith the application dated 10.08.2017.
26. In order to substantiate her arguments, Ld. Counsel for plaintiff has relied on judgments titled Akash Mohan Gupta Vs. Civcon Engineering & Contracting MANU/DE/0218/2008, Bal Krishna Gupta Vs. Vikash Aggarwal MANU/DE/1308/2014, Rakesh Kumar Vs. Kalawanti (deceased) through LRs & Ors MANU/DE/4527/2013, Iqbal Singh Vs. Mahender Singh MANU/DE/5899/2012, Dharshan Singh Vs. Avtar Singh 2002(VI) AD (Delhi) 799, Chet Ram Gupta Vs. Motian Devi Lamba MANU/DE/2775/208
27. Per contra, Ld. Counsel for defendants have argued that plaintiffs were to pay Rs. 32,50,000/ at the time of execution of sale C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 18 of 32 deed on 25.06.2003. However, plaintiffs failed to make the balance payment as per the Agreement to Sell dated 17.06.2003. Even the plaintiffs did not turn up in the office of SubRegistrar for execution of sale deed in their favour. It is further argued that defendant no.3 had completed the entire work. The plaintiffs inspected the premises and were satisfied and also issued a full and final Discharge Certificate in favour of the defendant no.3 certifying that the work carried out was in accordance with the Construction Agreement dated 18.06.2003. It is further stated that plaintiffs had assured the defendants that the balance amount of Rs. 17.5 lacs shall be paid directly by the Corporation Bank on 25.06.2003 when the sale deed was to be executed. It is further argued that defendants had informed the plaintiffs that the balance sale consideration should be paid by 27.07.2003 failing which the defendants would be constrained to terminate both the agreements. Since plaintiffs failed to make the balance payment by the said date, defendants vide notice 22.09.2003, informed that both the agreements had been terminated. The advance C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 19 of 32 amount was refunded by the defendants to the plaintiffs through cheques. Thereafter, the defendants sold the suit property to one Mr. N.K. Sawhney. It is further argued that the plaintiffs did not even make Mr. N.K. Sawhney, the party to the suit for the reasons best known to them. It is further argued that the drafts Ex.PW4/1 and Ex.PW4/2 are of 06.07.2003 much after the date when the sale deed was to be executed.
28. It is further argued that vide order dated 25.11.2003, Hon'ble High Court had granted exparte ad interim order in favour of the plaintiffs thereby restraining the defendants from alienating, transferring or parting with the possession of the suit property subject to the condition that plaintiffs shall deposit the amount of Rs. 50 lacs in the Hon'ble High Court. However, plaintiffs failed to deposit the said amount of Rs. 50 lacs and consequently, vide order dated 20.01.2004, Hon'ble High Court vacated the interim order dated 25.11.2003. It is further argued that in the light of order dated 01.02.2008 passed by Hon'ble High Court of Delhi wherein Hon'ble C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 20 of 32 High Court has made clear observations with regard to the intention of the plaintiffs, it becomes clear that there was no intention on the part of plaintiffs to get the sale deed executed.
29. I have considered the arguments raised on behalf of both the sides as well as perused the entire record.
30. This is a suit for specific performance. I shall now discuss the law relating to the specific performance.
31. The plaintiffs have sought protection u/s 52 of the Transfer of Property Act, 1882. Section 52 reads as under:
52. Transfer of property pending suit relating thereto.During the pendency in any Court having authority by the Central Government of any suit or proceedings which is not collusive and in which any right to immoveable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceedings so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 21 of 32 impose.
32. Section 52 of the T.P. Act deals with 'Lis Pendens'. In order to constitute a lis pendens the following elements must be present: (1) There must be a suit or proceeding pending in a Court of competent jurisdiction; (2) The suit or proceeding must not be collusive; (3) The litigation must be one in which right to immovable property is directly and specifically in question; (4) There must be a transfer of or otherwise dealing with the property in dispute by any party to the litigation; (5) Such transfer must affect the rights of the other party that may ultimately accrue under the terms of the decree or order.
33. The main issue between the parties which is the bone of contention is the readiness and willingness on the part of the plaintiffs. This court has to decide whether plaintiff were ready and willing to perform their part of obligation as per the agreement entered into between the parties.
34. For determining the issue between the parties, section C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 22 of 32 16(c) of the Specific Relief Act, 1963 is relevant. Section 16 of the Relief Act, 1963 provides for personal bars to relief. This provision is reproduced hereunder:
16. Personal bars to relief. Specific performance of a contract cannot be enforced in favour of a person
a) who would not be entitled to recover compensation for its breach; or
b) who has become incapable of informing, or violates any essential term of, the contract that on his part remains to be performed, or acts in fraud of the contract, or wilfully acts at variance with, or in subversion of, the relation intended to be established by the contract; or
c) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.
Explanation. For the purpose of clause (c),
(i) where a contract involves the payment of money, it is not essential for the plaintiff to actually tender C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 23 of 32 to the defendant or to deposit in court any money except when so directed by the court;
(ii) the plaintiff must aver performance of, or readiness and willingness to perform, the contract according to its true construction.
35. Section 16(c) of Specific Relief Act, 1963 provides that the person seeking specific performance must prove that he has performed or has been ready and willing to perform the essential terms of the contract which are to be performed by him.
36. The words "ready" and "willing" imply that the person was prepared to carry out the terms of contract. The distinction between "readiness" and "willingness" is that the former refers to financial capacity and the latter to the conduct of the plaintiff wanting performance. Generally, readiness is backed by willingness.
37. In R.C. Chandiok & Anr. Vs. Chuni Lal Sabharwal & Ors (1970) 3 SCC 140, Hon'ble Supreme Court of India has held that "readiness" and willingness" cannot be treated as a straight jacket formula. This has to be determined from the entirety of the facts and C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 24 of 32 circumstances relevant to the intention and conduct of the party concerned.
38. In N.P. Thirugnanam Vs. Dr. R. Jagan Mohan Rao *& Ors. (1995) 5 SCC 115, Hon'ble Supreme Court of India held as under:
"....Section 16(c) of the Act envisages that plaintiff must plead and prove that he had performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than those terms the performance of which has been prevented or waived by the defendant. The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant is required to be considered by the court while granting or refusing to grant the relief of specific performance. If the plaintiff fails to either aver or prove the same, he must fail."
39. I have considered the judgments relied on by the plaintiffs. All the said judgments are distinguishable to the facts of the C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 25 of 32 present case. While relying on the judgment titled Bal Krishan Gupta (supra), plaintiffs have argued that the condition of depositing the balance sale consideration in the court is not required to as a matter of routine. However, in the said judgment, it is also held that though the Court is empowered to direct the plaintiff to do so.
40. In the judgments R.C. Chandiok & Anr and N.P. Thirugnanam (supra), Hon'ble Supreme Court of India has clearly held that the continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance.
41. Applying this principle to the facts of the present case, it has clearly come on record that the plaintiffs have failed to perform their part of obligation as is reflected in the order dated 25.11.2003. Vide this Hon'ble High Court had granted exparte ad interim order in favour of the plaintiffs thereby restraining the defendants from alienating, transferring or parting with the possession of the suit property subject to the condition that plaintiffs shall deposit the C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 26 of 32 amount of Rs. 50 lacs in the Hon'ble High Court. However, plaintiffs failed to deposit the amount of Rs. 50 lacs in the court and consequently, vide order dated 20.01.2004, Hon'ble High Court vacated the interim order dated 25.11.2003. Hence, mandatory requirement of readiness and willingness as enshrined in section 16(c) of the Specific Relief Act is not fulfilled in the present case as plaintiff despite being given opportunity by the Court, failed to fulfill the condition of depositing the balance sale consideration amount of Rs. 50 lacs in the court to show their readiness and willingness to purchase the suit property. Further, merely an averment that plaintiffs are willing and ready to perform their obligation does not satisfy the requirements of section 16(c) of Specific Relief Act. These have to be proved also in order to show their bonafide. However, same is missing in the present case.
42. As regards the testimonies of PW2, PW3 and PW4 as well as the documents proved on record by them, they only show that the plaintiffs had intention to purchase the suit property, however, C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 27 of 32 they lacked the readiness in other words financial capacity to purchase the suit property which is a mandatory requiremente as per the law laid down by Hon'ble Supreme Court of India as has already been discussed above.
43. Further, the plaintiffs have sought protection of section 52 of Transfer of Property Act on the ground that till the pendency of the suit, defendants could not have sold the suit property. In this regard, order dated 01.02.2008 passed by Hon'ble High Court is very relevant. In the said order, while dismissing the application of the plaintiff u/o 1 rule 10 CPC, Order 6 rule 17 r/w section 151 CPC whereby plaintiffs had sought leave of the court to amend the plaint on the ground that they had come to know that defendants have sold the suit property to one Mr. N.K. Sahani and Mrs. Rani Sahani, Hon'ble High Court had made certain observations, relevant portion of which is reproduced below:
"After the plaintiff's evidence was over, the plaintiffs want to amend the suit and also want to implead defendant's no.5 and 6 as parties to the C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 28 of 32 suit. Defendants no.5 and 6 cannot be added as parties to the suit since the sale of the property was made to defendants no.5 and 6 after vacation of the interim injunction by this Court when the plaintiffs failed to to deposit the balance sale consideration. The two purchasers cannot be burdened with unnecessary litigation and asked to appear in the Court. The property was sold to them by defendants no.1 to 3 after plaintiffs failed to deposit the balance sale consideration and after this Court vacated the interim injunction. I consider that grave prejudice would be caused to the rights of the third party i.e Mr. and Mrs. Sahani if they are made to stand as defendants in the suit between plaintiffs and other defendants since they had no dispute, neither their purchasing the property is contrary to law.
44. From the above order, Hon'ble High Court has clearly observed that the selling of the suit property by defendant no.1 to 3, after vacation of the interim order, was not contrary to the law. Hence, it is clear that the act of the defendants in selling the suit property to C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 29 of 32 Mr and Mrs. Sahani was not in violation of the mandate of section 52 of the Transfer of Property Act. There is a proviso to this section which states that the requirements of this section can be waived under the authority of the Court and on such terms as it may impose. In the present case, the Hon'ble High Court waived this condition while vacating the ad interim injunction order earlier passed in favouru of the plaintiffs. Moreover, the observation made in the above order dated 01.02.2008 makes it amply clear that defendants no.1 to 3 were well within their right to transfer the title of the suit property in favour of Mr and Mrs. Sahani. Hence, section 52 of Transfer of Property Act, 1882 also does not come to the rescue of the plaintiffs.
45. In view of the above discussion, this Court holds that the plaintiffs failed to show that they were ready and willing to perform their part of the obligations arising from the agreement to sell dated 17th June, 2003 as well as the construction agreement dated 18th June. Hence, this issue stands decided against the plaintiffs and in favour of the defendants.
C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 30 of 32 Issue No.2:
Whether the agreement to sell as well as the construction agreement dated 17th and 18th June, 2003 respectively stand rescinded, as alleged in the written statement, if so, to what effect? OPD
46. The onus of proving this issue was on the defendants. In view of my findings on issue no.1, it is proved that plaintiffs had failed to perform their part of obligation and subsequently defendants have sold the suit property to Mr. N.K Sahani, the agreement to sell dated 17.06.2003 and construction agreement dated 18.06.2003 stood rescinded. Accordingly, this issue also stands decided in favour of the defendants and against the plaintiffs.
47. RELIEF:
In view of my above findings, no relief is granted. The suit of the plaintiffs stand dismissed leaving parties to bear their own costs. The defendants no.1 to 3 vide order dated 20.04.2006 had deposited a sum of Rs. 10 lacs in the Court which was taken by them from the plaintiffs as advance as part of the agreements entered into C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 31 of 32 between them. Since, suit of the plaintiffs has been dismissed, let the amount of Rs. 10 lacs be released in favour of plaintiffs alongwith interest, if any. Decree sheet be prepared accordingly.
Announced in the Open Court (Pooran Chand)
On this day of 08th September, 2017 ADJ06 (South East)
Saket Courts, New Delhi.
C.S. No.8553/16 Dr. Manav Rakshak Vs. Civcon Engg. & Contracting Co. Page No. 32 of 32