Delhi District Court
Smt. Madhu Chaturvedi vs Tek Ram Sharma on 20 December, 2024
DLST010030632020
In the Court of Sh. Munish Bansal,
District Judge-03 (South District),
Saket Courts Complex, New Delhi.
CS No.: 202/2020
In the matter of :-
1. Smt. Madhu Chaturvedi,
W/o Dr. Dev Dutt Chaturvedi,
R/o Second Floor, B-4/160 B,
Safdarjung Enclave,
New Delhi- 110029.
2. Sh. Anand Purohit,
S/o Dr. Dev Dutt Chaturvedi,
R/o Second Floor, B-4/160 B,
Safdarjung Enclave,
New Delhi- 110029. .......Plaintiffs
Versus
Sh. Tek Ram Sharma,
S/o Late Sh. Sudhan Ram Sharma,
R/o B-4/160 B, Ground Floor,
Safdarjung Enclave,
New Delhi- 110029. ......Defendant
Digitally
signed by
Date of institution : 30.06.2020
MUNISH
BANSAL
MUNISH
BANSAL
Date:
Arguments heard on : 19.12.2024
2024.12.20
17:14:58
+0530
Date of decision : 20.12.2024
CS/202/2020 Page 1 of 32
SUIT FOR SPECIFIC PERFORMANCE
JUDGMENT
1. The present suit has been filed by the Plaintiffs against the Defendant seeking specific performance of Agreement to Sell dated 01.03.2020, executed between the parties with respect to property i.e. Ground Floor of B-4/160 B, Safdarjung Enclave, New Delhi- 110029, comprising of three bedrooms with attached bathrooms, drawing room, dining room, kitchen, two balconies alongwith full roof rights in the said property on which four servant quarters have been built (hereinafter referred to as the suit property).
1.1 Facts as averred in the plaint are that in the month of February, 2020, the Defendant approached the Plaintiffs, representing himself to be the absolute owner of the suit property vide registered Conveyance Deed dated 03.05.2012 and showed his interest to sell the same on the ground that he was in dire need of funds. Believing the representation made by the Defendant, an Agreement to Sell dated 01.03.2020, duly notarized on 05.03.2020, was executed between the parties whereby the Defendant agreed to sell the suit property for a total sale consideration of Rs.1,50,00,000/-. In furtherance to the said agreement, Plaintiffs have performed their part of the Agreement to Sell and have already paid an amount of Rs.11,00,000/- (Rupees Eleven Lacs) vide cheque bearing no. 103727 dated 01.03.2020, drawn on State Bank of India, out of total sale consideration of Rs.1,50,00,000/- (Rupees Once Crore Fifty Lac). Digitally signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:15:04 +0530 CS/202/2020 Page 2 of 32 It was further agreed that upon receipt of balance sale consideration, the Defendant will execute a Registered Conveyance Deed/ Sale Deed in favour of Plaintiffs. In furtherance of the aforesaid, the Plaintiffs arranged a sum of Rs.82 Lacs and also arranged funds for payment of requisite stamp duty and charges for execution of registration of Conveyance Deed by borrowing it from their relatives. The Plaintiffs also had to withdraw the FDRs held by them, prematurely and they have also applied for Home Loan of Rs. 70 Lacs from the Housing Development Finance Corporation Limited (HDFC) and the said amount was duly sanctioned on 09.05.2020 with the condition that said loan was to be availed on or before 05.11.2020. The sale transaction in question was to be completed by 03.04.2020, however due to lock-down on account of Covid-19 pandemic, the registration of conveyance of immovable properties were put under abeyance. However, the Defendant assured the Plaintiffs that sale transaction would be completed forthwith once the restrictions put forth by the Government are lifted/ eased. Subsequently, the Government lifted the restrictions and registration of conveyance deeds/ documents were allowed w.e.f. 04.05.2020. The Plaintiffs were always ready and willing to perform their part of the obligations under Agreement to Sell and were ready to pay the agreed balance sale consideration of Rs.1,39,00,000/- and Plaintiffs, on several occasions, requested the Defendant to fulfill his obligations, however, the Defendant has retracted and refused to perform his part of the obligation under the Agreement to Sell Digitally signed by MUNISH MUNISH BANSAL dated 03.03.2020. Thereafter, in May, 2020, the Defendant BANSAL Date:
2024.12.20 17:15:09 +0530 CS/202/2020 Page 3 of 32 approached the Plaintiff no.2 and stated that he was not interested in selling the suit property and wished to cancel the said Agreement to Sell and stated to return Rs.22,00,000/- as agreed under the Agreement to sell and forced Plaintiff no.2 to sign a draft cancellation of agreement to sell by threatening the Plaintiffs to face dire consequences. The Defendant also asked Plaintiff no.2 to ensure that Plaintiff no.1 executes the said cancellation of agreement to sell but the Plaintiff no.1 squarely refused to do the same. Furthermore, the said cancellation has never been legally executed as all parties did not execute it nor any money was refunded by the Defendant to the Plaintiffs. The Defendant though promised to pay a total sum of Rs.22 Lacs to the Plaintiffs, however, the same was never done. The Plaintiff no.2 has approached the Defendant on various occasions either to refund the agreed amount or to execute Sale Deed in favour of Plaintiffs, however, the Defendant has failed to perform his part of obligation. Accordingly, the Plaintiffs were constrained to send a legal notice dated 03.06.2020 thereby calling upon the Defendant to fulfill his part of obligations, however, vide his reply dated 10.06.2020, the Defendant refused to do so on false, frivolous and baseless grounds. The plea raised by the Defendant in his reply to legal notice regarding sale consideration being Rs.3 Crore is ex facie false and contrary to legally bounded document executed between the parties and the plea regarding the Agreement to Sell having been cancelled is also false, frivolous and baseless. It is further averred that the due to the act of Defendant of breach of contract, the Plaintiffs have suffered Digitally signed by MUNISH huge financial loss of earnings of interest due to premature MUNISH BANSAL BANSAL Date:
2024.12.20 17:15:15 +0530 CS/202/2020 Page 4 of 32 withdrawal of FDRs and expenditure of interest incurred in arranging the funds from relatives and from the Bank in seeking sanction of loan and have also undergone harassment and mental agony and on these accounts, the Plaintiffs are claiming damages/ compensation of Rs.50,00,000/-.
On these grounds, the Plaintiffs have filed the present suit seeking specific performance of Agreement to Sell dated 01.03.2020 thereby directing the Defendant to execute Registered Conveyance Deed/ Sale Deed in favour of Plaintiffs with respect to suit property and to accept balance sale consideration of Rs.1,39,00,000/-. In the alternative, the Plaintiffs are claiming a total sum of Rs.72,00,000/- (Rs.22 Lacs on account of refund of double of advance amount of Rs.11 Lacs and Rs.50 Lacs on as damages/ compensation). The Plaintiffs have also prayed for pendente lite and future interest @15% p.a. on such sum. Hence, this suit.
2. Summons of the suit were issued to the Defendant. The same were duly served upon the defendant upon which the Defendant appeared and filed written statement stating therein that apart from the admitted Agreement to Sell, another Agreement described as 'Fittings & Fixtures Agreement' each providing payment of consideration amount of Rs.1,50,00,000/- was executed and both the documents together constitute single transaction/ contract of the suit property and that the Agreement to Sell record therein, "For fittings and fixtures provided therein the parties have entered into a separate agreement.", thus, the MUNISH BANSAL total sale consideration was Rs.3 Crores. Therefore, the suit filed Digitally signed by MUNISH BANSAL Date: 2024.12.20 17:15:20 +0530 CS/202/2020 Page 5 of 32 by the Plaintiffs is not maintainable. It is stated that Plaintiffs have fraudulently withheld the said 'Fittings & Fixtures Agreement' to deprive/ defraud the Defendant of half of agreed sale consideration. It is further stated that the e-stamp paper on which Agreement to Sell was prepared was purchased on 03.03.2020 and Plaintiffs themselves got the same prepared, therefore, the same could not be executed on 01.03.2020 as alleged by the Plaintiffs. It is further stated that Plaintiffs did not have arrangement of necessary/ adequate funds to discharge their obligation for payment of balance agreed sale consideration of Rs.3 Crore or even Rs.1 Crore 50 Lacs, as fraudulently claimed by the Plaintiffs. It is stated that it was agreed that if Plaintiffs fail to pay the agreed amount by 03.04.2020, the bayana/ earnest money, paid by them would stand forfeited. It is further stated that in para no. 13 of the plaint, the Plaintiffs themselves admit that Plaintiff no.2 has cancelled the agreement to sell, therefore, the Plaintiffs cannot seek specific performance of the same by way of the present suit. It is further stated that no cause of action is disclosed in the present suit and that the suit has not been properly valued for the purposes of court-fees and jurisdiction as agreed sale consideration was Rs.3 Crore.
2.1. On merits, all the contents of the plaint are denied. It is specifically stated that the Defendant neither owned nor could he agree to transfer roof rights of the building and said clause was fraudulently added by Plaintiffs in Agreement to Sell. It is stated that Defendant is 89 years old and suffering from various Digitally signed by MUNISH MUNISH BANSAL ailments and is residing all alone and that the Plaintiffs have BANSAL Date:
2024.12.20 17:15:24 +0530 CS/202/2020 Page 6 of 32 taken advantage of his old age and ill health. It is stated that the Plaintiffs got executed two different agreements i.e. Agreement to Sell and Fittings & Fixtures Agreement, each showing consideration amounts of Rs.1,50,00,000/- on the ground that it would help him in obtaining home loan from bank, however, the other agreement was mischievously withheld by the Plaintiffs. It is further stated that on Receipt qua bayana amount of Rs.11 Lacs, the Plaintiffs deliberately did not mention/ specify the mutually agreed sale consideration of Rs. 3 Crores. It is specifically denied that the Defendant refused to perform his part of obligation, and stated that the Plaintiffs had to first pay the balance sale consideration by 03.04.2020, which they never paid/ offered to him. It is stated that since the Plaintiffs have failed to perform their part of obligation, the said bayana amount of Rs.11 Lacs stood forfeited in terms of Agreement to Sell and that the Plaintiffs are not entitled to any relief either specific performance or of alternative relief of recovery of double of bayana amount and damages, as claimed by the Plaintiffs. It is prayed that the present suit be dismissed with costs.
3. Replication to written statement was filed on behalf of the Plaintiff wherein the Plaintiff has denied all the pleadings made in the written statement and has reaffirmed and reiterated the pleadings made in the plaint. It is stated that no separate agreement as 'Fittings & Fixtures Agreement' has ever been entered into between the parties as the suit property is a very old construction and its fittings & fixtures carry no value. It is stated Digitally that the Agreement to Sell was executed on a stamp paper dated signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:15:29 +0530 CS/202/2020 Page 7 of 32 03.03.2020 which provide an 'effective date' of 01.03.2020. It is reiterated that total sale consideration amount was Rs.1,50,00,000/- only and not Rs. 3 Crores as alleged by the Defendant.
4. From pleadings of parties, following issues were framed on 06.07.2022:-
1. Whether the parties had entered into two contracts i.e. Agreement to Sell and Agreement for furniture and fittings? OPD
2. Whether the plaintiff is entitled to specific performance of agreement to sell dated 01.03.2022 directing the defendant to conduct the sale proceedings? OPP
3. If issue no. 2 is decided in negative, whether the plaintiff is entitled to recovery of sum of Rs.72 Lacs from the Defendant alongwith interest? If yes, at what rate and for which period? OPP
4. Relief.
Thereafter, matter was fixed for Plaintiff's evidence.
5. To prove their case, the Plaintiff no. 2 himself stepped in witness box as PW1 and tendered his evidence by way of affidavit Ex. PW1/1, wherein he deposed on the lines of his contentions made in the plaint. He placed reliance on several documents viz.:
Digitally signed by MUNISH MUNISH BANSAL
1. Agreement to Sell Ex. PW1/A. BANSAL Date:
2024.12.20 17:15:34 +0530 CS/202/2020 Page 8 of 32
2. True copy of cheque no. 103727 dt. 01.03.20 Ex. PW1/B.
3. Copy of passbook Ex. PW1/C.
4. Receipt dt. 01.03.2020 for Rs.11,00,000/- Ex. PW1/D.
5. Sanction letter dated 09.05.2020 from HDFC Ex. PW1/E
6. Banker's certificate alongwith bank stagement Ex. PW1/F
7. Copy of legal notice dt. 03.06.2020 Ex. PW1/G.
8. Complaint dt. 13.06.2020 filed by defendant before SHO, PS Sarojini Nagar Ex. PW1/H.
9. Medical certificate of my father Mr. Dev Dutt Chaturvedi Ex. PW1/I. PW1 was cross-examined by Ld. Counsel for the Defendant.
5.1. Examination of PW2 Ms. Madhu Chaturvedi was conducted before the Local Commissioner appointed by the Ld. Predecessor of this Court vide order dated 07.08.2023. PW2 Smt. Madhu Chaturvedi tendered her evidence by way of affidavit Ex.PW2/A and has relied upon the documents already exhibited as Ex.PW1/A to Ex. PW1/I. She was cross-examined at length by Ld. Counsel for the Defendant.
Thereafter, Plaintiff's evidence was closed.
6. To rebut the case of the Plaintiffs, the Defendant got himself examined as DW1 and tendered his evidence by way of affidavit Ex. DW1/A and relied upon certified true copy of Sale Deed in his favour dated 18.04.2012 Ex. DW1/1. He was cross- Digitally signed by MUNISH examined by Ld. Counsel for the Plaintiffs. MUNISH BANSAL BANSAL Date:
2024.12.20 17:15:39 +0530 CS/202/2020 Page 9 of 32 Thereafter, DE was closed.
7. I have heard arguments as advanced by Ld. Counsel for the Plaintiff, gone through the written submissions and perused the record. My issue-wise findings are as under:-
Issue no.1 Whether the parties had entered into two contracts i.e. Agreement to Sell and Agreement for furniture and fittings? OPD
8. Onus to prove this issue was upon the Defendant. The Defendant in his written statement has claimed that two separate agreements i.e. 'Agreement to Sell' and another agreement described as 'Fittings & Fixtures Agreement', each providing for payment of consideration amount of Rs.1,50,00,000/-, were entered into between the parties and that Clause-I of 'Agreement to Sell' Ex. PW1/A mentioned that "For fittings and fixtures provided therein the parties have entered into a separate agreement." However, the said 'Fittings & Fixtures Agreement' or a copy thereof has not been placed on record by the Defendant. During cross-examination, the Defendant stated that the suit property is a fully furnished house with TV, fridge, furnishings such as carpet etc. cumulative valued at Rs.1.5 Crores. He also stated that he had asked the Plaintiff no. 2 to get one agreement but the Plaintiff no.2 had got two stating that since he was getting full money then what was the problem in having two agreements.
8.1. Though in the WS, it is pleaded that both the agreements i.e. agreement to sell and agreement for fitting and fixtures together Digitally constituted a single transaction /contract of agreement to sale of the signed by MUNISH MUNISH BANSAL BANSAL Date: suit property for the agreed sale consideration of Rs. 3 Crores, 2024.12.20 17:15:43 +0530 CS/202/2020 Page 10 of 32 however, in the cross examination, defendant appearing as DW1 has stated that the agreement for fitting and fixtures was separate agreement. The agreement for fitting and fixtures or its copy admittedly has not been placed on record. In this regard, defendant has pleaded that though mutually agreed consideration for the suit property was Rs. 3 Crore but plaintiff no. 2 deliberately and fraudulently in a pre-planned manner did not wanted to mention the said sale consideration and therefore, what he did was that subsequently he came to the defendant with two documents, one being agreement to sell and the other being fitting and fixtures agreement each showing consideration amount of Rs. 1,50,00,000/- stating it would help the plaintiff in obtaining home loan from the bank, impressing upon the defendant that he would in any case be getting his full consideration amount of Rs. 3 Crores and that copy of neither of the two documents was given to the defendant stating that plaintiff no.1 also had to first signed the same. In cross examination, defendant has stated that he has bought and sold many properties in his lifetime, one of which is of GK-I bearing no. 269, and that he has bought and sold the properties through dealers and therefore, he has similarity with the process of buying and selling of properties. In this scenario, it appears highly improbable that the defendant would not ensure keeping a copy of both the alleged agreements with him after signing the same. Moreover, there is no pleading by the defendant that when plaintiff no. 2 kept both the agreements with him for getting the signatures of plaintiff no. 1, he subsequently ever asked the plaintiff no. 2 to supply him the fully signed copies of both the agreements to him.
8.2. Ex. PW1/H is the complaint dated 13.06.2020 filed by Digitally signed by the defendant before SHO PS Sarojni Nagar and Ex. DW1/P1 is reply MUNISH MUNISH BANSAL BANSAL Date: dated 10.06.2020 of the defendant to the legal notice dated 03.06.2020 2024.12.20 17:15:48 +0530 CS/202/2020 Page 11 of 32 of the plaintiff. Perusal of both these documents shows that the factum of existence of second agreement qua fitting and fixtures have not been mentioned in the said documents by the defendant. Rather, in the complaint Ex. PW1/H, it has been stated that various things in the agreement to sell were blank and plaintiffs convinced him that since they are neighbours and nobody is going anywhere, the plaintiffs will fill the blank spaces of the agreement to sell when they reach final conclusion and thus his signatures were taken on the agreement to sell by collusion. Similarly, in the reply to the legal notice Ex. DW1/P1, it has been stated that the agreement to sell signed between the parties were blank and various things were not finalized between the parties.
8.3. However, in the WS there is no mention of the aforesaid stand taken in the complaint Ex. PW1/H and the reply to the legal notice Ex. DW1/P1 regarding the agreement to sell signed between the parties being blank and various things not finalized between the parties. No explanation has been put forth in the WS as regards the aforesaid inconsistent stand taken by the defendant. In cross examination, defendant admits that there was nothing blank in the reply to the legal notice Ex. DW1/P1 and that he was unwell at the time of signing and was not able to carefully see as to what he was signing, but further admits that reply to the legal notice was drawn up on his instructions. In cross examination, he further states that he does not remember signing on any blank papers. On the same day, on further cross examination, defendant states that he was unwell so he was not sure as to what he had signed. On being questioned, whether there were at-least some clauses in the documents to sign, defendant stated that something was written, but he was not sure as to what. Thus, from the said pleadings as well as testimony of the defendant, it MUNISH BANSAL is clear that defendant has been taking inconsistent, wavering and Digitally signed by MUNISH BANSAL Date: 2024.12.20 17:15:53 +0530 contradictory stands as regards the existence of the second agreement CS/202/2020 Page 12 of 32 qua fitting and fixtures. Moreover, in the opinion of this court, if the defendant in written statement as well as in his evidence states existence of two agreements and both the agreements were with the plaintiff and copies thereof not given to the defendant, the said factum was well within the knowledge of the defendant from day one, however, the mention of the same is missing in the earlier documents i.e. complaint Ex. PW1/H and reply to legal notice Ex. DW1/P1. It is only when the present suit has been instituted, the plea of existence of second agreement qua fitting and fixture have come to fore by way of WS. No other proof or evidence has been tendered to show the existence of another agreement qua fitting and fixtures. Simplictor the mention in the agreement to sell Ex. PW1/A that 'for fitting and fixtures provided therein the parties have entered into separate agreement' would not come to the advantage of defendant in view of the aforesaid inconsistent stand taken by him in his own documents.
8.4. Counsel for the defendant has vehemently argued that the two agreements together constituted single transaction/ contract of agreement to the sale of the suit property, however, perusal of the agreement Ex. PW1/A shows that it is clearly mentioned that for fittings and fixtures provided therein, parties have entered into a separate agreement. In the opinion of the Court, had the agreement for fittings and fixtures constituting a single transaction, there is no explanation as to why a separate agreement for fittings and fixtures, as pointed out in Ex. PW1/A, has been mentioned to be entered into.
8.5. Counsel for the defendant has also argued that PW1 has in his evidence admitted existence of two documents. He has referred to cross examination of PW1 dated 07.08.2023 wherein PW1 has Digitally signed by stated 'both the above documents were prepared/ drafted by Mr. HD MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:15:57 Sharma .... even the stamp paper of Ex. PW1/A was purchased by Mr. +0530 CS/202/2020 Page 13 of 32 HD Sharma. I myself the read contents of both the documents at my house. He sent both the above documents to me by whatsapp and email...'. However, when the testimony of the PW1 is read as a whole and in a holistic manner, it is clearly apparent that the two documents which are being referred by PW1 in the said cross examination are receipts Ex. PW1/D and agreement to Sell Ex. PW1/A and nowhere it mentions about the agreement qua fittings and fixtures. The said submission on behalf of the defendant is clearly misleading and is therefore, rejected and consequently serves no purpose in favour of the defendant as far as decision on the present issue is concerned.
8.6. In view of the aforesaid discussion, this Court is of the view that defendant has failed to prove that the parties have entered into two contracts i.e. agreement to sell and agreement for fitting and fixtures and therefore, the said issue is decided against the defendant and in favour of plaintiffs.
Issue no. 2 and 3 Whether the plaintiff is entitled to specific performance of agreement to sell dated 01.03.2020 (inadvertently mentioned as 01.03.2022) directing the defendant to conduct the sale proceedings? OPP If issue no. 2 is decided in negative, whether the plaintiff is entitled to recovery of sum of Rs.72 Lacs from the Defendant alongwith interest? If yes, at what rate and for which period? OPP
9. Onus to prove these issues was on the Plaintiff. The discussion with respect to decreeing or dismissing the suit for specific performance can be taken up basically under four heads Digitally as under:
signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:01 +0530 CS/202/2020 Page 14 of 32
(a) Whether there was agreement to sell of the suit property in favour of the plaintiffs?
(b) Who is guilty of breach of contract, whether the plaintiff or the defendant?
(c) Whether the plaintiffs have always been and continues to be ready and willing to perform their part of contract?
(d) Whether the plaintiffs are entitled to discretionary relief of specific performance?
(a) whether there was agreement to sell of the suit property in favour of the plaintiffs?
9.1. Counsel for the defendant has argued that the contract between the parties, was comprised in two documents i.e. agreement to sell Ex. PW1/A and agreement for fitting and fixtures each with a consideration of Rs. 1.50 Crores, with total consideration of Rs. 3 Crores. Per contra, counsel for the plaintiff has contended that there existed only one agreement to sell Ex. PW1/A and the existence of the said agreement Ex.PW1/A has not been disputed by the defendant.
9.2. In reference to discussion on issue no.1, this Court has already concluded that defendant has failed to prove the existence of the other agreement qua fittings and fixtures and therefore, only one agreement i.e. agreement to sell Ex. PW1/A remains in picture. In cross-examination, DW1 has admitted his signatures on the said agreement Ex. PW1/A. DW1 has further Digitally signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:06 +0530 CS/202/2020 Page 15 of 32 admitted that he signed the agreement to sell Ex. PW1/A on 03.03.2020. Even on the receipt dt. 01.03.2020 for bayana/ earnest money Ex.PW1/D, DW1 in his cross-examination has admitted his signatures and that he has received a cheque of Rs.11 Lakhs on 01.03.2020.
9.3. Thus, it stands proved that there was an agreement to sell Ex. PW/1A in favour of the plaintiffs.
(b) who is guilty of breach of contract, whether the plaintiff or the defendant 9.4. Counsel for the defendant has argued that as per clause (2) of the agreement to sell Ex. PW1/A, the balance payment of Rs.1 Crore 39 Lacs shall be paid by the second party (plaintiffs herein) to the first party (defendant herein) against separate receipt before the execution of the sale deed by 03.04.2020 and in case second party fails to pay the balance amount by the date stipulated above, the money paid by the second party would stand forfeited and in case the first party fails to complete the sale, execute the necessary documents and/or give away the vacant, peaceful possession of the demised premises, the second party shall be entitled to receive and first party is obliged to pay the second party twice (double) the sum received by the first party. He further submits that vide these clauses, since plaintiffs' rights were protected, therefore, rendering covid situation irrelevant and inconsequential and on Digitally signed by MUNISH plaintiffs' refusal / failure to pay the balance sale consideration MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:13 +0530 CS/202/2020 Page 16 of 32 by stipulated date i.e. 03.04.2020, the amount of earnest money stood forfeited.
9.5. To this, counsel for the plaintiff has submitted that due to lock-down declared by the Government of India and restraints imposed thereunder due to pandemic Covid-19, defendant refused to perform his obligations under the aforesaid agreement to sell dated 03.03.2020 and even thereafter, after lifting of the lock-down, the defendant has failed to perform his obligations under the said agreement Ex. PW1/A and thereafter, on the said failure of the defendant, plaintiffs were constrained to send legal notice Ex. PW1/G to the defendant calling upon him to fulfill his obligation under agreement to sell. He further submits that vide reply Ex.DW1/P1, defendant took flimsy grounds to evade his obligations under the said agreement. He further states that after sending the said reply to legal notice, defendant also filed a complaint Ex.PW1/H alleging fabrication, falsification and fudging of documents, misappropriation of funds, cheating, forgery and criminal breach of trust etc. by stating that plaintiffs conspired to allure the defendant into selling the property and the said agreement Ex.PW1/A contained many blank spaces and various points were yet to be finalized between the parties.
9.6. Neither in the said complaint nor in the reply to the legal notice, defendant has stated that any breach has been made by the plaintiffs and that as a result of said breach, the bayana/ earnest money of Rs.11 Lakhs stood forfeited. Pertinently, in Digitally signed by MUNISH clause (7) of the reply to legal notice Ex.PW1/D1, there is a MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:18 +0530 CS/202/2020 Page 17 of 32 categorical assertion that there is no legal obligation towards the defendant to execute the Sale Deed as agreement to sell has already been cancelled between the parties and defendant is ready to return the amount of Rs.11 Lakhs as both the parties have rescinded the agreement to sell with mutual consent by signing the cancellation of the agreement. In the reply to legal notice, though there is mention of undated cancellation agreement, however, there is no mention that the said cancellation agreement was taken away by plaintiffs. However, subsequently, in the police complaint, defendant has alleged that plaintiff no.2 came to the defendant with the signed draft of the cancellation of the agreement to sell and handed over the same to the defendant and further stated that plaintiffs are no more interested in the property as the offer price is beyond their expectation, to which defendant also offered the plaintiffs to return the earnest money lying in his bank account. Perusal of the said complaint nowhere mentions that the said draft cancellation was taken away by the plaintiff no.2 but it is only stated that plaintiffs under some conspiracy requested the defendant to hold the money for some time and they will take it back as and when proper/ suitable time will come. Surprisingly, in the written statement, defendant has denied that he ever stated to the plaintiffs that defendant would return Rs.22 Lacs to the plaintiffs and that there is no question of cancellation of the agreement to sell after forfeiture of the earnest money. It is apparent that as regards cancellation of the agreement to sell is concerned, inconsistent stand has been taken by the defendant, as defendant Digitally MUNISH signed by MUNISH BANSAL in reply to legal notice has admitted his readiness to return the BANSAL Date:
2024.12.20 17:16:22 +0530 CS/202/2020 Page 18 of 32 amount of Rs.11 Lakhs. No averment in the reply to the legal notice or in complaint, as to forfeiture of the amount for the termination of the agreement to sell Ex.PW1/A on the efflux of time for performance of the said contract, has been made.
9.7. In the plaint, it has been pleaded that in May, 2020, the Defendant approached the Plaintiff no.2 and stated that he was not interested in selling the suit property and wished to cancel the said Agreement to Sell and stated to return Rs.22,00,000/- as agreed under the Agreement to sell and forced Plaintiff no.2 to sign a draft cancellation of agreement to sell by threatening the Plaintiffs to face dire consequences. The Defendant also asked Plaintiff no.2 to ensure that Plaintiff no.1 executes the said cancellation of agreement to sell but the Plaintiff no.1 squarely refused to do the same. Furthermore, the said cancellation has never been legally executed as all parties did not execute it nor any money was refunded by the Defendant to the Plaintiffs. The Defendant though promised to pay a total sum of Rs.22 Lacs to the Plaintiffs, however, the same was never done. The Plaintiff no.2 has approached the Defendant on various occasions either to refund the agreed amount or to execute Sale Deed in favour of Plaintiffs, however, the Defendant has failed to perform his part of obligation. However, in WS, the plea taken is that since plaintiffs have admitted cancellation of agreement, they cannot seek specific performance. But the stand taken in the reply to legal notice and the complaint to police regarding cancellation does find mention in WS. In WS, defendant has not Digitally denied his earlier stand taken in police complaint that signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:26 +0530 CS/202/2020 Page 19 of 32 cancellation agreement was handed over to him. Thus, what emerges out is that cancellation agreement, if any, was with the defendant also that the said cancellation has never been legally executed as all parties did not execute it since the said fact was not been specifically denied in WS.
9.8. In these circumstances, it can be fairly assessed that defendant considered the agreement to be subsisting at the time of sending of the reply to legal notice as well as filing of the police complaint.
9.9. It is well settled that in sale of immovable property, there is no presumption that time is the essence of contract, however, the Court may infer performance in a reasonable time if the conditions are evident from the express terms of the contract, from the nature of the property and from the surrounding circumstances. The said position of law has been reiterated by the Hon'ble Supreme Court in its judgments titled 'Chand Rani vs. Kamal Rani (1993) 1 SCC 519' and in 'Gaddipati Divija & anr vs. Pathuri Samrajyam & ors (2023) SCC OnLine SC 442'.
9.10. In this regard, relevant to quote herein is Section 55 of the Indian Contract Act, which reads as under:-
"55. Effect of failure to perform at fixed time, in contract in which time is essential.-- When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, Digitally signed by MUNISH and fails to do any such thing at or before the specified time, the MUNISH BANSAL BANSAL Date:
2024.12.20 contract, or so much of it as has not been performed, becomes voidable 17:16:31 +0530 CS/202/2020 Page 20 of 32 at the option of the promisee, if the intention of the parties was that time should be of the essence of the contract. Effect of such failure when time is not essential. --If it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure. Effect of acceptance of performance at time other than that agreed upon.--If, in case of a contract voidable on account of the promisor's failure to perform his promise at the time agreed, the promisee accepts performance of such promise at any time other than that agreed, the promisee cannot claim compensation for any loss occasioned by the non- performance of the promise at the time agreed, unless, at the time of such acceptance, he gives notice to the promisor of his intention to do so.
9.11. Admittedly, in the present case, the agreement was for the sale of immovable property. Even assuming that time was the essence of the contract in the present case and that plaintiffs have committed the breach in failing to perform at or before a specified time, as per the above quoted Section 55 of the Indian Contract Act, the contract i.e. Ex.PW1/A became voidable at the option of the promisee i.e. the defendant herein. However, there is nothing on record i.e. there is nothing mentioned in the reply to legal notice and the police complaint that defendant exercised his option of avoiding the voidable contract. A voidable contract, unless avoided, is a perfectly valid and subsisting contract.
9.12. Perusal of the legal notice Ex.PW1/G shows that plaintiffs have categorically pleaded that they are ready and Digitally willing to complete the sale transaction between the plaintiffs and signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:35 +0530 CS/202/2020 Page 21 of 32 the defendant and they have the balance sale consideration ready for disbursal alongwith the sanctioned home loan by the HDFC bank and accordingly, called upon the defendant to complete the sale transaction by accepting the balance sale consideration and executing the requisite conveyance deed within 15 days from the receipt of the said notice. Perusal of the said legal notice also proves that there is nothing to show that plaintiffs were willing or have agreed upon to receive Rs.22 Lakhs (double the earnest money of Rs.11 Lakhs) from the defendant. Reply to the said legal notice and the statements made therein by the defendant has already been discussed above and needs no further reiteration. A vague and frivolous plea of the agreement containing blanks being got signed from the defendant by the plaintiffs, was taken by the defendant which was later on retracted by the defendant in his cross-examination by very conveniently stating that due to ill health, he was unable to carefully see what he was signing.
9.13. Needless to mention and discuss herein are the circumstances prevalent at the time of first lock-down imposed with effect from 23.03.2020 due to COVID-19 pandemic. This Court can always take judicial notice of the said circumstances, wherein several restrictions were imposed on the movement of the people of country as well as the restrictions with regard to the working and regular functioning of the banks as well as government offices. As regards banks, though the banks were opened, however, the banking transactions were limited in nature as well as in time. As regards opening /working of the Digitally MUNISH signed by MUNISH BANSAL government offices in Delhi, restrictions on the execution and BANSAL Date:
2024.12.20 17:16:40 +0530 CS/202/2020 Page 22 of 32 registration of conveyance deed/ documents were lifted by Government of India on 04.05.2020. This Court also takes notice of the fact that due to extreme fear among the citizens of the country of being engulfed in the first wave of COVID-19, practically all the population of the country remained indoors due to the restrictions imposed by the government.
9.14. On the lifting of the restrictions imposed due to COVID-19 and opening of the lock-down, within a reasonable time, plaintiffs have shown their financial capacity to fulfill the agreement exhibited Ex. PW1/A and also sent the legal notice Ex. PW1/G, calling upon the defendant to fulfill and complete the sale transaction.
9.15. Thus, in view of the aforesaid facts & circumstances, it can be fairly inferred and concluded that it was the defendant who is guilty of breach of the agreement Ex. PW1/A and not the plaintiffs.
(c) Whether the plaintiffs have always been and continues to be ready and willing to perform their part of contract?
9.16. Section 16 (c) of the Specific Relief Act,1963 (in short, SRA) 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 Digitally him other than those terms, the performance of which has been signed by prevented or waived by the defendant. The continuous readiness MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:44 +0530 CS/202/2020 Page 23 of 32 and willingness on the part of the plaintiff is a precedent to the grant of relief of specific performance. The readiness and willingness of the plaintiff to perform the essential part of the contract would be required to be demonstrated by him from the institution of the suit till it is culminated into the decree of the Court. To adjudge whether plaintiff is ready and willing to perform his part of the contract, the Court must take into consideration the conduct of the plaintiff prior and subsequent to the filing of the suit alongwith the attending circumstances. The amount of consideration which he has to pay to the defendant must of necessity be proved to be available. Right from the date of the performance of the contract till the date of the decree, he must prove that he is ready and have always been willing to perform his part of the contract. The Court is required to infer from the facts and circumstances whether plaintiffs were always ready and willing to perform their part of the contract.
9.17. It has been observed by Hon'ble Apex Court in Gaddipati Divija & anr vs. Pathuri Samrajyam & ors as under:-
"27. In Syed Dastagir vs T.R. Gopalakrishna Setty, it was held, "the language in Secion 16 (c) does not require any specific phraseology but only that the plaintiff must aver that he has performed or has always been and is willing to perform his part of the contract. So, the compliance of "readiness and willingness" has to be in spirit and substance and not in letter and form."
28. In Aniglase Yohannan vs Ramlatha & ors, this Court held:-
"11. Lord Campbell in Cort v. Ambergate, Nottingham and Boston and Eastern Junction Rly. Co. [(1851) 117 ER 1229 : 17 QB 127] observed Digitally signed by MUNISH that in common sense the meaning of such an averment of readiness MUNISH BANSAL BANSAL Date:
2024.12.20 and willingness must be that the non- completion of the contract was 17:16:49 +0530 CS/202/2020 Page 24 of 32 not the fault of the plaintiffs, and that they were disposed and able to complete it, had it not been renounced by the defendant.
12. The basic principle behind Section 16 (c) read with Explanation
(ii) is that any person seeking benefit of the specific performance of contract must manifest that his conduct has been blemishless throughout entitling him to the specific relief. The provision imposes a personal bar. The Court is to grant relief on the basis of the conduct of the person seeking relief. If the pleadings manifest that the conduct of the plaintiff entitles him to get the relief on perusal of the plaint he should not be denied the relief."
9.18. In Syed Dastagir vs T.R. Gopalakrishna Setty, it was observed as under:
"9. So whole gamut of issue raised is, how to construe a plea specially with reference to Section 16 (c) and what are the obligations which the plaintiff has to comply with reference to his plea and whether the plea of the plaintiff could not be construed to conform to the requirement of the aforesaid Section, or does this section require specific words to be pleaded that he has performed or has always been ready and is willing to perform his part of the contract. In construing a plea in any pleading, Courts must keep in mind that a plea is not an expression of art and science but an expression through words to place fact and law of ones case for a relief. Such an expression may be pointed, precise, some times vague but still could be gathered what he wants to convey through only by reading the whole pleading, depends on the person drafting a plea. In India most of the pleas are drafted by counsels hence aforesaid difference of pleas which inevitably differ from one to other. Thus, to gather true spirit behind a plea it should be read as a whole. This does not distract one from performing his obligations as required under a statute. But to test, whether he has performed his obligations one has to see the pith and substance of a plea. Where a statute requires any fact to be pleaded then that has to be pleaded may be in any form. Same plea may be stated by different persons through different words then how could it be constricted to be only in any particular nomenclature or word. Unless statute specifically require for a plea to be in any particular form, it can be in any form. No specific phraseology or language is required to take such a plea. The language in Section 16(c) does not require any specific phraseology but only that the plaintiff must aver that he has performed or has always been and is willing to perform his part of the contract. So the compliance of Readiness and willingness has to be in spirit and substance and not in letter and form. So to insist for mechanical production of the exact words of an statute is to insist for the form rather than essence. So absence of form cannot dissolve an essence if already Digitally pleaded."
signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:53 +0530 CS/202/2020 Page 25 of 32 9.19. In the present case, counsel for the defendant has argued that the plaintiffs have failed to prove their readiness and willingness and therefore, relief of specific performance cannot be granted in their favour. He further submits that in evidence affidavit Ex. PW-1/1, plaintiff no. 2 appearing as PW1 has admitted that he paid an amount of Rs.11 Lakh as earnest money out of the total consideration of Rs.1.50 Crore to the defendant and the balance sale consideration was to be paid to the defendant on or before 03.04.2020, being the final date for completion of the sale transaction. It is further argued that completion of the sale transaction necessarily includes execution of the registered Sale Deed in their favour, for which plaintiffs had to have with them as on 03.04.2020, balance of Rs.2.89 Crore plus the stamp duty (5%) and registration fees (1%) amounting to Rs.18 Lakhs, totalling to Rs.3.07 Crores or even as per the plaintiff's own plea, balance of Rs.1.48 Crore (Rs. 1.39 crore as balance consideration amount plus Rs.9 lacs for stamp duty and registration charges).
9.20. As already discussed and held above, only one agreement i.e. agreement to sell Ex.PW1/A has been proved and the other agreement qua the fittings and fixtures has not been proved by the defendant. It has already been noted that inconsistent, wavering and contradictory stands have been taken by the defendant by stating the consideration amount to be Rs.3 Crore as is reflected from the documents Ex. DW1/P1 and Ex.PW1/H, which are reply to legal notice and police complaint Digitally signed by MUNISH by the defendant, but, the said documents nowhere talk about the MUNISH BANSAL BANSAL Date:
2024.12.20 17:16:58 +0530 CS/202/2020 Page 26 of 32 second agreement qua the fittings and fixtures. As already held above, the existence of the second agreement could not be proved. Ex. PW1/A i.e. the agreement to sell is in writing which contains the terms and conditions regarding the sale of the immovable property. As per Section 91 of the Indian Evidence Act, no evidence can be given in proof of the terms of such agreement except the document itself. Mere submissions without any cogent evidence, cannot lead to conclusion that the total consideration amount was Rs.3 Crores. The total consideration amount mentioned in the agreement to sell Ex. PW1/A is Rs.1.50 Crore out of which Rs.11 Lakhs have been admittedly paid by the plaintiffs to the defendant. Thus, what emerges out is that plaintiffs for the completion of the sale were required to pay the balance consideration of Rs.1.39 Crore to the defendant.
9.21. As regards readiness of the plaintiffs, PW1 has relied upon the documents i.e. Sanction letter dated 09.05.2020 from the HDFC Ex. PW1/E and banker's certificate alongwith the bank statement Ex.PW1/F to show their willingness to perform the essential terms of contract which were to be performed by them. Perusal of the Ex.PW1/F shows that it is a certificate by the HDFC bank certifying that the plaintiff no.2 was maintaining a balance of Rs.82 Lakhs since 13.03.2020 to 19.06.2020. Ex.PW1/E is the Sanction letter dated 09.05.2020, showing a loan amount of Rs.70 Lakhs approved in favour of both the plaintiffs. The total of both the amounts comes out to Rs.1.52 Crore. The said factum of the said amounts being ready Digitally signed by MUNISH MUNISH BANSAL BANSAL Date:
with the plaintiffs was also mentioned in the legal notice Ex. 2024.12.20 17:17:02 +0530 CS/202/2020 Page 27 of 32 PW1/G sent to the defendant. Even during the course of the proceedings of the present suit, three FDRs first one having a maturity value of Rs.55,13,854/- as on 06.07.2021, the second one for a principal amount of Rs.80 Lakhs with date of deposit 18.12.2020 which is set to mature on 19.12.2025 and the third one for principal amount of Rs.7,87,437/- set to mature on 02.09.2021, were placed on record and the same were exhibited as Ex.PW1/X and Ex.PW1/Y. Thus, the plaintiffs have been able to show and prove their readiness to perform the essential terms of contract which were to be performed by them.
9.22. As already discussed above, as on the date of performance i.e. 03.04.2020, nationwide lock-down was imposed due to Covid-19 pandemic and there were restrictions on the movement of people of the country as well as the normal working hours of the banks were curtailed and even restrictions were imposed upon the execution and registration of the conveyance deeds/ documents by the Government. It is well settled that the Court cannot expect anyone to do the impossible or rather say a practically impossible thing. In such a scenario of nationwide lock-down with large scale restrictions imposed, the performance of the contract on the part of both the parties would have been a practical impossibility. It is to be noted that as soon as restrictions were lifted, the plaintiffs acted in a reasonable manner in reasonable time to get the loan amount sanctioned on 09.05.2020, which shows their promptness and willingness to Digitally perform the contract. Furthermore, a legal notice dated signed by MUNISH MUNISH BANSAL BANSAL Date:
03.06.2020 Ex.PW1/G was sent to the defendant calling upon 2024.12.20 17:17:07 +0530 CS/202/2020 Page 28 of 32 him to complete the sale transaction as per agreement to sell Ex.PW1/A. In the said legal notice, it has been stated on behalf of the plaintiffs that after lifting of restrictions from the execution and registration of conveyance deed/ documents w.e.f. 04.05.2020, plaintiffs have requested the defendant to complete the said sale transaction by accepting the balance agreed sale consideration but the defendant had avoided to complete the sale transaction taking an excuse of apprehension and panic due to Covid-19.
9.23. Counsel for the defendant has referred to the cross-
examination of PW1 wherein PW1 has deposed that he has sought refund of Rs.22 Lakhs after the defendant has refused to execute the sale deed and it was in May, 2020 after the withdrawal of the lock-down. PW1 has also deposed, " It is wrong to suggest that I demanded Rs.22 Lakhs from the defendant in May, 2020 on the premises that agreement to sell Ex. PW1/A stood canceled." Further reference is made to the statement of PW1, "I did not tender the balance sale consideration to the defendant as the same was to be paid at the time of registration of the sale deed ". On the basis of the said testimony, it is argued that since PW1 has himself admitted that he has sought refund of Rs.22 Lakhs from the defendant and that PW1 did not tender the balance sale consideration to the defendant, therefore, the readiness and willingness on the part of the plaintiffs is not proved and therefore, plaintiffs' present suit for specific performance must fail. It is to be noted that as per Digitally signed by MUNISH explanation (i) to Clause (c) of Section 16 of SRA, it has been MUNISH BANSAL BANSAL Date:
2024.12.20 17:17:14 +0530 CS/202/2020 Page 29 of 32 provided that where contract involves payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in the Court any money except when so directed by the Court. By sending legal notice calling upon the defendant to complete the sale transaction and also specifically mentioning about the arrangement of funds for the payment of the balance consideration amount in the said legal notice, the plaintiffs have shown their readiness and willingness and the service of the said legal notice, which is not disputed by the defendant since reply to the same has been sent by the defendant, itself is sufficient proof of the intention of the plaintiffs to tender the amount to the defendant.
9.24. Relevant to mention herein is Section 23 of SRA which states that a contract, otherwise proper to be specifically enforced, may be so enforced, though a sum be named in it as the amount to be paid in case of its breach and the party in default is willing to pay the same, if the Court, having regard to the terms of the contract and other attending circumstances, is satisfied that the sum was named only for the purpose of securing performance of the contract and not for the purpose of giving to the party in default an option of paying money in lieu of specific performance. Since this Court has observed that the agreement Ex. PW1/A is proper to be specifically performed since all the criteria for specific performance has been satisfied, the mention of the clause in the agreement Ex PW1/A regarding the penal clause if either of the party to the agreement fails in the MUNISH Digitally signed by MUNISH BANSAL performance of the contract, cannot and should not prevent this BANSAL Date:
2024.12.20 17:17:20 +0530 CS/202/2020 Page 30 of 32 Court from enforcing the specific performance of the contract.
(d) Whether the plaintiffs are entitled to discretionary relief of specific performance?
9.25. The present suit has been instituted in the year 2020 when the 2018 amendment to the Specific Relief Act (SRA) had already come into force. As per the amended Section 10 of SRA, the specific performance of a contract shall be enforced by the Court subject to the provisions contained in Sub Section (2) of Section 11, Section 14 and Section 16. Even Section 20 has been amended which earlier provided discretion to the Court to order specific performance and the Court was not bound to grant such relief merely it was lawful to do so. Now with the 2018 amendment to SRA, the discretion of the Court has been done away with in line with the wording of Section 10, SRA.
9.26. Since in the present case, the facts of the case shows that Sections 11 (2) and Section 12, SRA are not applicable and also the plaintiffs have crossed the barrier of Section 16 of SRA, this Court find no reason but to go with the statutory direction as envisaged in the newly amended Section 10 of SRA read with the deletion of old Section 20 of SRA and being substituted by new Section 20 of SRA, of directing specific performance of the agreement Ex. PW1/A in favour of the plaintiffs and against the defendant.
Digitally signed by MUNISH MUNISH BANSAL BANSAL Date:
2024.12.20 17:17:26 +0530 CS/202/2020 Page 31 of 32 9.27. In view of above findings, plaintiffs are entitled to specific performance of Agreement to Sell dated 01.03.2020 Ex.
PW1/A. Accordingly, issues no.2 is decided in favour of the plaintiffs and against the defendant. Since issue no.2 has been decided in positive, no more deliberation on issue no.3 is required and accordingly, issue no.3 stands disposed off.
Relief
10. In view of the above discussion, this suit of the Plaintiffs is decreed. The Plaintiffs are entitled to Specific Performance of execution of Agreement to Sell dated 01.03.2020 Ex.PW1/A. The defendant is directed to execute a Registered Sale Deed in favour of Plaintiffs with respect to suit property i.e. Ground Floor of B-4/160 B, Safdarjung Enclave, New Delhi- 110029, comprising of three bedrooms with attached bathrooms, drawing room, dining room, kitchen, two balconies alongwith full roof rights in the said property on which four servant quarters have been built and to accept remaining sale consideration of Rs.1,39,00,000/-, within a period of two months from the date of this judgment. Costs of the suit is also awarded in favour of the Plaintiff. Decree-sheet be prepared accordingly.
File be consigned to record room. Digitally signed by MUNISH MUNISH BANSAL Date:
BANSAL 2024.12.20 17:17:32 +0530 Announced in the Open Court on 20.12.2024 (Munish Bansal) District Judge-03 South District: Saket Courts New Delhi CS/202/2020 Page 32 of 32