Andhra HC (Pre-Telangana)
N. Jagadesh Babu And Ors. vs Geeta Bai And Ors. on 2 May, 1997
Equivalent citations: 1997(4)ALT127
JUDGMENT P. Ramakrishnam Raju, J.
1. The plaintiffs are the appellants. They filed the suit for specific performance of an agreement for sale dated 31-12-1978 executed by respondents 1 to 3; or alternatively to grant a decree for partition and separate possession of 3/8th share of plaint schedule; or alternatively to grant a decree for a sum of Rs. 1,50,000/- by way of damages.
2. Appellants 2 and 3 are sisters of Appellant No. 1. Respondents 2 to 4 are the sons and 5 to 8 are the daughters of first respondent. Respondent No. 1 is the absolute owner of Ac.43-00 cents of agricultural land in Survey Nos.113 and 114 of Moosapet village and Survey No. 580 of Kukatpally, Hyderabad, described in the schedule attached to the plaint. Respondent No. 1 offered to sell the said property and the appellants agreed to purchase the same at the rate of Rs. 5,000/- per acre. The suit agreement was executed on 31-12-1978 by the respondents 1 to 3 for a total consideration of Rs. 2,15,000/-. A sum of Rs. 116/- was paid in cash and a post-dated cheque for Rs. 10,000/- was given containing the date of 15-1-1979 towards advance. The third respondent again received a further sum of Rs. 1,000/- as part of sale consideration on 5-1-1979 and passed a receipt. However when the appellant had published a notice in Deccan Chronicle on 24-2-1979 inviting objections if any for the sale transaction, their Advocate received a notice dated 1-3-1979 issued on behalf of respondents 4 to 8 alleging that the plaint schedule property was the property of their father - late Gangaram and husband of the first respondent and that all the respondents have inherited the same having 1/8th share each. The said notice was also followed by another notice dated 25-3-1979 issued on behalf of respondents 1 to 3 cancelling the suit agreement on the ostensible reason that the Urban Land Ceiling Authority has refused permission by its order dated 6-3-1979. the appellants through their Advocate sent a suitable reply on 2-4-1979. In spite of the same the respondents did not co-operate in executing the registered sale deed after receiving the balance of sale consideration. The appellants were all through ready and willing to perform their part of the contract. Hence the suit.
3. Respondents 1 to 3 in their written statement stated that the property was acquired by their father-late Gangaram, though it stands in the name of the first respondent widow of Gangaram. The property belongs to Gangaram and it was not the absolute property of the first respondent. The sale deed was nominally executed in favour of the first respondent at the instance of Gangaram, that is why respondents 2 to 4 were also added in the agreement as vendors. The appellants were not ready with money at any time. Even the cheque dated 15-1-1979 issued by them, when presented was bounced for want of funds in the account of N. Venugopal Rao (P.W.2). Even the permission sought for before the competent authority, Urban Land Ceiling was refused. Therefore, the performance of the contract has become frustrated.
4. Respondents 4 to 8 have also filed a separate written statement with similar allegations.
5. Before the trial Court, first plaintiff was examined as P.W.1, besides examining his brother as P.W.2. Exs.A-1 to A-13 were marked. Respondent No. 2 was examined as R. W.1 and Ex.B-1 was marked on behalf of respondents.
6. The trial Court after framing necessary issues found that the plaint schedule property belongs to the first respondent and she alone is the owner; performance of the agreement was frustrated because or refusal to grant permission by the competent authority, Urban Land Ceiling; and the appellants were not ready and willing to perform their part of the contract. Aggrieved by the decree and judgment, this appeal by the unsuccessful plaintiffs.
The points for consideration in this appeal are:
(1) Whether the appellants are ready and willing to perform their part of the contract at all material times;
(2) Whether cancellation of agreement is proper and valid; and (3) To what relief:
7. Before the points framed above are taken up for discussion, it is necessary to decide whether the property in question is the separate property of the first respondent or the property of late Gangaram, husband of the first respondent and father of other respondents of whom respondents are the legal heirs-.
8. The demised property comprises Survey Nos. 113, 114 of Moosapet village and Survey No. 580 of Kukatpally village admeasuring Ac.43-00 cents of agricultural land. Although respondents 1 to 4 are arrayed as vendors in the agreement, respondents 1 to 3 alone signed the agreement. It is admitted in the agreement that the vendors are the absolute owners and possessors of the land in question. However, the appellants contend that the property is the absolute property of the first respondent alone. To substantiate this contention relience is placed on the fact that the land was purchased in the name of the first respondent in the year 1957 and not in the name of her husband. The fact that the property is the absolute property of the first respondent is further reinforced by the fact that the Tahsildar, Hyderabad West Taluk declared the validity of the said sale Under Section 50(b) of A.P. (T.A.) Tenancy of Agricultural Lands Act, 1950, marked as Ex.A-1. On the other hand, the contention of the respondents is that although the property was purchased benami in the name of the first respondent, the first respondent had no wherewithal and the sale consideration was passed from her husband who was in possession of the property as well as sale deed. Even D. W. 1 asserted the same thing, but he could not deny that his father did not possess any other property. He could not also assign any reason why the property was purchased by his father in the name of his mother. The suit land stands in the name of his mother alone in the revenue records althrough.
9. In view of the evidence on record and also in view of Ex.A-1 referred to above, it is clear that the property belongs to the first respondent and there is no material to come to a different conclusion that the property was purchased by late Gangaram benami in the name of his wife.
10. However, Sri K. Mahipathi Rao, learned Counsel for the respondents submits that in view of the admission of the appellants in the agreement that the property belongs to respondents 1 to 4, they are estopped from contending to the contrary that it is the absolute property of the first respondent alone. He further submits that no separate appeal or cross-objections need not be filed questioning the finding of the trial Court in this regard and for this purpose, he placed relience on a decision reported in V. V. Krishna Vara Prasad v. S. Surya Rao. As already seen the evidence on record shows that the first respondent alone is the absolute owner of the suit property and there is no material to take a contrary view. Therefore, the mere fact that there is an admission that it is the absolute property of respondents 1 to 4, the same is not decisive or final. Therefore, I have no hesitation in concurring with the finding of the trial Court that the property is the absolute property of the first respondent.
Point No. 1:
It is the case of the appellants that they are ready and willing to perform their part of the contract as per the terms of the agreement. It is not in dispute that the property was agreed to be purchased by them at the rate of Rs. 5,000/- per acre for a total consideration of Rs. 2,15,000/-. The appellants paid a sum of Rs. 10,000/- by way of a post-dated cheque dated 15-1-1978. In addition to a sum of Rs. l16 by way of cash for which the respondents have passed a receipt. No time limit is fixed for fulfiling the terms of the contract. under Clause (g) of the agreement, it is stipulated that the vendors have agreed to obtain necessary permission from the Government and inform the vendees about the final date for registration. Therefore, time is not the essence of the contract. But, still the question remains whether the appellants were always ready and willing to perform their part of the contract. The fact that a postdated cheque was given on the date of agreement shows that there is no money covering the said cheque on that date. Added to that the said cheque was dis-honoured when it was presented in Bank on 17-5-1979. There circumstances in my view clearly show that the appellants are not ready and willing to perform their part of the contract.
11. Sri J.V. Suryanarayana Rao, learned Senior Advocate appearing on behalf of the appellants submits that since the Manager of the Bank informed P.W.2 about the dishonour of cheque, he immediately deposited a sum of Rs. 10,000/- on the same day and issued a telegraphic notice to the respondents to present the cheque once-again. It is also further contended that Respondent No. 3 received a sum of Rs. 1,000/- on 5-1-1979 as part payment of sale consideration and passed Ex.A-9 receipt. Reliance is also placed on part payment of Rs. 1,000/- made through a cheque dated 18-4-1979 in favour of the third respondent which was encashed in the Bank on 23-4-1979. Issuance of this cheque and also providing for it shows the sincerity on the part of the appellants to act upon the agreement. I may add that the cheque for Rs. 10,000/- dated 15-1-1979 was dishonoured on 17-5-1979. Therefore, payment of Rs. 10,000/- through a cheque dated 18-4-1979 does not establish that the appellants are ready and willing to perform their part of the contract. However, as already seen, the learned Counsel for the appellants contends that on intimation about the dishonour of the cheque on 17-5-1979, a sum of Rs. 10,000/- was deposited in the Bank on the same date to cover the said cheque, and therefore, dishonour of the cheque cannot be viewed as a pointer towards unreadiness on the part of the appellants. P.W.2 who is an Advocate and brother of the appellants states that it was agreed that the cheque dated 15-1-979 should be encashed only after the signature of Respondent No. 4 is obtained on Ex.A-2 agreement and then only the cheque should be presented. This stipulation does not find place in the agreement, nor was there any basis in the reply notice (Ex.A-8) dated 24-7-1992, or in the plaint for this stand. Therefore, this explanation for not providing sufficient funds to cover the cheque dated 15-1-1979 is an after-thought and cannot be accepted. A part from this, P.W.1 made a categorical admission that they were not having balance amount for paying the sale consideration to perform their part of the contract when they issued notices to the respondents seeking performance of the agreement. For all these reasons, in my view, the lower Court has rightly come to the conclusion that the appellants are not ready and willing to perform their part of the contract.
12. However, the learned Counsel for the appellants contends that the evidence of P.W.2 shows that the appellants have money and no cross-examination is directed to suggest that he has no money. The oral evidence of P.W.2 cannot out-weigh the documentary evidence showing the conduct of P.W.2 in not being able to provide for the cheque dated 15-1-1979. In the face of the categorical statement made by P. W. 1 that they do not have sufficient money to perform their part of the contract, I do not think that there is still necessity to cross- examine P.W.2 on this aspect or to suggest that they have no money. Therefore, non-cross-examination or non-suggestion in this regard to P.W.2 does not in my view advance the case of the appellants any further.
13. The learned Counsel for the appellants relying on Section 16(c), Explanation-I of the Specific Relief Act, submits that it is not essential for the appellants to actually tender or deposit in Court any money, except when so directed by the Court. He placed reliance on a decision of this Court in S. Indira v. N. Venkataramanna, wherein a Division Bench of this Court has accepted that even though the plaintiff is not having funds for a brief period of 20 days after the receipt of reply notice, the same cannot be construed that the plaintiff is not ready and willing to perform his part of the contract. Having regard to the facts and circumstances of the case, the High Court viewed that there was no default in that case, but the High Court has not accepted on principle that the plaintiff need not be ready and willing to perform his part of the contract at all material times. From this it cannot be inferred that the High Court has laid down a general principle.
14. However, the plaintiffs need not deposit the entire sale consideration or actually tender the same to the respondents, but this does not enable the plaintiffs to commit default in payment of advance money as per the terms of the agreement. It is obligatory on the part of either of the parties to the agreement to perform his or her part of the contract; but it is not obligatory to tender the entire sale consideration or deposit in the Court to show readiness on the part of the plaintiffs. But at the same time, it cannot be postulated that the plaintiffs who have agreed to pay a part of the sale consideration by way of advance under the terms of the agreement need not pay but can commit default. The intention of Section 16(c) Explanation-I cannot travel, that far so as to allow default on the part of the plaintiffs even with regard to payment of advance money stipulated under the contract. Therefore, this submission in my view has no substance; in as much as the mandatory requirement contained Under Section 16(c) of the Act requires on the plaintiffs seeking specific performance of the agreement for sale to aver and prove that they have performed or have always been ready and willing to perform the essential terms of the contract which are putforth by them. In this case, in view of the foregoing discussion, it is clear that the appellants have failed to pay the advance amount stipulated under the contract. The fact that when the cheque was dishonoured on 17-5-1979, they were able to deposit the required money later to cover the said cheque is no answer for the mandatory requirement. It is not open to the appellants to give a cheque without providing money for it and yet contend that on dishonour of the cheque they would make good the balance in the account and this should be treated as sufficient compliance of Section 16(c) of Specific Relief Act. As already seen, the appellants cannot issue stale cheque, and still contend that money will be provided whenever the cheque is dishonoured by the Bank. Therefore, I have no hesitation in accepting the finding of the trial Court that the appellants were not ready and willing to perform their part of the contract. The point is accordingly answered.
Point No. 2:
Sri J.V. Suryanarayana Rao, learned Senior Advocate appearing for the appellants submits that the proposed land is an agricultural land and the same is specifically described as such in Ex.A-2 agreement itself, and as such, it does not require any permission from the Urban Land Ceiling Authority before alienation. He relies on definition 2(o) of Urban Land (Ceiling and Regulation) Act, 1973 hereinafter called 'the Act'; Urban land is defined Under Section 2(o), which says that any urban land which is mainly used for agricultural purpose shall not be included as urban land. However Clause (c) of Section 2(o) states that notwithstanding anything contained in Clause (b) of the explanation, land shall not be deemed to be used mainly for agriculture if the same is specified in the Master Plan for any purpose other than agriculture. Relying on these provisions, the learned Counsel submits that inasmuch as there is no proof that this land is specified in the Master Plan for any purpose other than for agriculture, there is no need to make an application for permission.
15. Sri Mahipathi Rao, learned Counsel for respondents submits that under Schedule-I, Kukatpally and Moosapet wherein the land is situated is shown as items (k) and (1) respectively in Schedule-I in Andhra Pradesh, and therefore, permission for alienation is necessary. under Sub-section 3 of Section 5 of the Act, a bar is imposed on transfer of vacant land exceeding the ceiling limit prescribed under the Act.
16. P.W.1 admitted that they entered into an agreement to purchase the property with an intention to make out plots and sell them. Even P.W.2, an Advocate, also admitted that normally permission is required for selling the suit land even as agricultural land. Even Ex.A-2 which is an admitted document also contemplates permission before alienation. From all the circumstances it can be safely concluded that parties contemplated that permission is necessary before alienation. Even then, the learned Counsel for the appellants Submits that the respondents have not made any proper application and get the said application rejected collusively. According to the learned Senior Advocate appearing for the appellants, as per rules, there should be a joint application by both parties and not by the vendors alone,. I may straight away answer this objection. The appellants never informed the respondents that they would also join in the application to be made for permission before the Urban Land Ceiling Authority. In fact this objection was not taken before the lower Court. Therefore, it is too late in the day to raise this objection when the application was rejected as early as on 6-3-1979.
17. In similar circumstances, I have taken the view that in view of the overriding effect given to the provisions of Urban Land (Ceiling and Regulation) Act, 1973, the decision rendered or orders passed under the said Act cannot be questioned in a Civil Court. As long as they are not challenged before the appropriate forum, the orders passed under the said Act have to be given effect to. Following the decision in M. Agarwal v. Syed Abdul Razack, it has to be held that the order of refusal of permission cannot be disputed in Civil Court. Therefore, I am of the view that questions regarding the validity of the application for exemption or correctness of the order passed under the Act are alien for decision by the Civil Court, since the Civil Court cannot sit in appeal over those proceedings. The lower Court has come to the conclusion that the Memo, Ex.B-1 dated 6-3-1979 cannot be challenged on the ground that the lands are agricultural lands. In fact, the memo discloses that the lands were kept fallow during the years 1970-71 to 1974-75 and as such they are treated as urban vacant lands. Therefore, as the lands were kept fallow, perhaps, the parties contemplated that permission from the Urban Land Ceiling Authority is required. The Lower Court has rightly relied on C. Ramaiah v. Mohammadunnisa Begum wherein, the suit brought for specific relief on the basis of an agreement of sale in respect of vacant land entered into prior to the coming into force of the Act could not be decreed in view of Sections 4,5 and 10 of the Act and any registration after coming into operation, shall be null and void under Sub-section 2 of Section 4. Therefore, 1 am of the view that there cannot be a direction for specific performance of suit agreement without permission from the Urban Land Ceiling Authority. As already stated P.W.1 has also admitted that they have purchased the land for purpose of dividing the same into plots and to sell them. Therefore, viewed from any angle, the contention of the learned senior Advocate appearing for the appellants that the suit lands are agricultural lands and as such no permission is necessary cannot be accepted as it would run counter to the terms of the agreement which contemplates obtaining necessary permission from the competent authority. The point is accordingly answered.
18. A feeble contention is raised by the learned Counsel for the appellants that the respondents issued notice dated 25-3-1979 terminating the agreement, but still they collected a sum of Rs. 1,0,00/- under the cheque dated 18-4-1979 which was encashed on 23-4-1979. According to the learned senior Advocate, this circumstance shows that the agreement was not determined for want of permission from the Urban Land Ceiling Authority as disclosed in the notice dated 25-3-1979. This contention, in my view, cannot be accepted. As already seen, permission of the Urban Land Ceiling Authority is a must for honouring the terms of the agreement. The mere fact that the cheque for Rs. 1,000/- was encashed subsequently does not defeat the order of rejection of application for permission. So also the mere fact of presenting the cheque for Rs. 10,000/- on 17-5-1979 does not in my view defeat the effect of the order of refusal of permission by the Competent Authority. Therefore, for all these circumstances, it cannot be held that the respondents alone have committed default and not the appellants.
Point No. 3:
Having regard to these findings, I am of the view that as the appellants have committed default they are not entitled for alternate claim of damages. The appeal, therefore, fails and is accordingly dismissed.