Allahabad High Court
Ramzan Ali And Another vs Altafur Rahman on 1 May, 2023
Author: Jaspreet Singh
Bench: Jaspreet Singh
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH Reserved Court No.19 Case :- SECOND APPEAL No. - 544 of 1984 Appellant :- Ramzan Ali And Another Respondent :- Altafur Rahman Counsel for Appellant :- A.A.Siddiqui,B.H.Siddiqui,D.C. Mukherjee,S.K. Chauhan,S.M.A Zaidi,S.R.Shukla,Shyam Mohan Counsel for Respondent :- Mohd. Arif Khan,Mohd. Aslam Khan,Mohiuddin Khan Hon'ble Jaspreet Singh,J.
1. Heard Sri Shyam Mohan, learned counsel for the appellants and Sri Mohd. Arif Khan, learned senior counsel alongwith Sri Mohd. Aslam Khan, learned counsel for the respondent.
2. This is the defendants' second appeal under Section 100 CPC preferred against the judgment and decree dated 28.05.1984 passed by the Sixth Additional District Judge, Lucknow in Regular Civil Appeal No.67/1983 by which the plaintiff's first appeal was allowed as a result a suit for specific performance of contract, which was dismissed by the trial court, was decreed by the lower appellate court.
3. The appeal came to be admitted by this Court on 22.08.1984 but no substantial question of law was formulated. Later on 24.11.2021, this Court after hearing the learned counsel for the parties formulated the following three substantial questions of law, which read as under:-
I. Whether the plaintiff can establish his readiness and willingness in order to obtain the relief for specific performance of contract dated 20-07-1977.
II. Whether the lower appellate court has incorrectly interpreted the agreement to sale dated 20-07-1977.
III. Whether the lower appellate court has incorrectly exercised its discretion in granting relief of specific performance of the contract dated 20-07-1997 contrary to the provisions of sections 19 & 20 of the Specific Relief Act.
4. It will also be relevant to notice that in the instant second appeal, the appellant no.1, Ramzan Ali was the defendant no.1 whereas appellant no.2, Musheer Ahmad was the defendant no.2 and both of them have died during the pendency of the instant appeal and their legal heirs have been duly brought on record and are represented by Sri Shyam Mohan, Advocate. Altafur Rahman, the original plaintiff, the respondent in the second appeal also expired and his legal heirs have been brought on record and are represented by the learned senior counsel Sri Mohd. Arif Khan. For the sake of convenience, the Court shall be referring to the parties as they were impleaded at the time of the institution of the case. The reference to plaintiff and defendant no.1 and 2 shall also include their legal heirs and representatives.
5. Before adverting to the respective contentions of the parties, brief facts giving rise to the instant second appeal are being noticed first.
6. Sri Altafur Rahman, as plaintiff, instituted a suit for specific performance of contract impleading the defendant no.1, who was the owner of 81 paisa share in House No.422/20 situate at Tope Darwaza, Police Station Saadatganj, Lucknow. It was pleaded that Ramzan Ali had earlier purchased the aforesaid property from the plaintiff by means of registered sale deed dated 25.02.1969 for a sum of Rs.3,000/-. The mother and sister of the plaintiff alongwith her husband (brother-in-law of the plaintiff) were residing in the upper portion of the said house while the defendant no.2, Musheer Ahmad was residing on the ground floor as tenant. It was also pleaded that the plaintiff was residing in Delhi on account of his embroidery business and in first week of July, 1977, it came to his knowledge that the defendant no.1 was intending to dispose of his share in the said house.
7. After negotiations, the defendant no.1 agreed to sale his 81 paisa share in the house in question to the plaintiff for a sum of Rs.8,900/-. A sum of Rs.3,000/- was paid to the defendant no.1 as earnest money and it was agreed that the defendant no.1 after obtaining necessary permission for transfer of share to the plaintiff shall inform the plaintiff within a month of having obtained such permissions and thereafter the plaintiff within a month thereof would get the sale deed executed. In case, if the plaintiff failed to get the sale deed executed, his earnest money would stand forfeited while in case defendant no.1 avoided the performance of his obligation then the plaintiff would have right to get the sale deed executed through the Court of law.
8. It is the case of the plaintiff that he did not hear from the defendant no.1 regarding permission so he came to Lucknow in November, 1977, he had the requisite money with him and on enquiring from the defendant no.1, the plaintiff was informed that the defendant was not able to obtain the permission but as soon as the same is received, he would inform the plaintiff of the same.
9. Once again the plaintiff enquired about the permission from the defendant no.1 but it was informed that the defendant no.1 had gone on a pilgrimage. The plaintiff again came to Lucknow in December, 1979 and he pressed for the execution of the sale deed but defendant no.1 evaded the request and also did not give a clear answer regarding obtaining the permission. The plaintiff sent a registered notice dated 12.12.1979, which was received by the defendant no.1 on 14.12.1979. The defendant no.1 in reply dated 01.01.1980 informed the plaintiff that it was the plaintiff himself who had expressed his inability to purchase the property, as allegedly the plaintiff could not arrange for the balance sale consideration, moreover, the rent was also due since 1969, accordingly, it was stated by the defendant no.1 that the earnest money was adjusted towards the arrears of the rent and the contract stood rescinded and the defendant no.1 had already transferred the property to the defendant no.2.
10. It is in the aforesaid background that the plaintiff instituted the suit for specific performance of contract on 02.02.1980 wherein apart from the facts pleaded, it was also specifically pleaded that the defendant no.2 was having full knowledge of the registered agreement between the plaintiff and the defendant no.1 and, as such, the defendant no.1 had unscrupulously sold the property to the defendant no.2 who is not a bonafide purchaser for valuable consideration without notice and, as such, the plaintiff was still ready and willing to perform his part of the contract to get the sale deed executed and also sought a direction that the defendant no.2 be directed to join the plaintiff for conveying proper title to the plaintiff.
11. The defendant no.1 filed his separate written statement wherein the execution and registration of the agreement to sale dated 20.07.1977 was admitted and it was further pleaded that the defendant no.1 had applied for the permission for transfer. It was also pleaded that it was the plaintiff himself who had expressed his inability to purchase the house in question and since the mother, sister and brother-in-law of the plaintiff were already residing in the said house as tenant on the upper portion and they had not paid the rent hence, on the request of the plaintiff the rent due from them was adjusted from the earnest money and the agreement stood rescinded and the plaintiff had the knowledge of the property being sold by the defendant no.1 in favour of the defendant no.2 and, as such, the suit was liable to be dismissed.
12. The defendant no.2 also filed his written statement wherein it was pleaded that the defendant no.2 informed and conveyed his decision to the plaintiff in respect of purchasing the property in question but at no point of time, the plaintiff disclosed to the defendant no.2 that the plaintiff already had registered agreement to sell in his favour in respect of the property in question. It was further pleaded that where the plaintiff himself knew of the intention of the defendant no.2 to purchase the property from the defendant no.1 and the plaintiff remained silent and now he was estopped for seeking a remedy for specific performance of contract which was purely equitable in nature and in the aforesaid circumstances, the suit was liable to be dismissed.
13. The trial court upon exchange of pleadings framed eight issues. However, the relevant issues upon which the suit was contested were:-
I) Whether the plaintiff always has been ready to discharge his obligation in the contract as alleged in para 6 of the plaint?
II) Whether the defendant no.2 purchased the house in suit with full knowledge of agreement in question as alleged in para 17 of the plaint?
III) Whether the defendant no.2 is the bonafide purchaser of the property in question for consideration without notice?
IV) Whether the plaintiff is estopped from seeking a decree of specific performance of contract as alleged in para 24 and 25 of the written statement of the defendant no.2?
14. The trial court considered the issues no.1, 3 and 5 as originally framed in the suit and returned a finding that the defendant had sent a registered letter to the plaintiff which was received by one Sri Kamrul Hasan on behalf of the plaintiff. It also noticed that there was no specific material to justify that the plaintiff had performed his part of contract and that he was ready and willing to perform his obligation and was ready to get the sale deed executed. The trial court while dealing with issue no.2 and 4, which related to the status of the defendant no.2, held that the defendant no.2 was aware of the agreement between the plaintiff and the defendant no.1 and he could not establish that he was not a bonafide purchaser for valuable consideration without notice hence, the said issues were decided against the defendant no.2. It also noticed that the plaintiff could not establish his readiness and willingness and for the aforesaid reasons, the suit filed by the plaintiff was dismissed while it ordered that the plaintiff was entitled to recover earnest money from the defendant no.1 by means of judgment and decree dated 25.03.1983.
15. Since the suit had been dismissed accordingly Altafur Rahman, the original plaintiff preferred a regular civil appeal under Section 96 CPC came to be heard and decided by the Sixth Additional District and Sessions Judge by means of judgment and decree dated 28.05.1984. The lower appellate court considering the material and record before it, allowed the appeal of the plaintiff and set aside the judgment and decree passed by the trial court. It specifically recorded that the plaintiff was ready and willing to perform his part of the contract as well as the defendant no.1 could not establish the plea raised by him regarding rescission of the contract and that the trial court did not appreciate the evidence appropriately and it further affirmed the finding against the defendant no.2 that he was not a bonafide purchaser for valuable consideration without notice and, consequently, it set aside the judgment and decree of the trial court and decreed the suit for specific performance of contract.
16. It is in the aforesaid background that both the defendant no.1 and 2 here jointly filed the instant second appeal.
17. Sri Shyam Mohan, learned counsel for the appellants has strenuously urged that the lower appellate court has committed a grave error in allowing the appeal inasmuch as the lower appellate court failed to consider the stipulation contained in the agreement to sale. It was specifically submitted that the agreement to sale contained a clause that the defendant no.1 would apply for the permission and in case for any reason whatsoever if the permission was not granted then the agreement could not be specifically enforced. It is also urged that the defendant no.1 had clearly informed the plaintiff regarding selling of the property to the defendant no.2 as the plaintiff had already expressed his unwillingness to purchase and the said notice, Ex.-A5 which was sent by the defendant no.1 to the plaintiff, was not properly appreciated by the lower appellate court and it reversed the finding of the trial court without meeting with the reasons and such exercise of jurisdiction by the lower appellate court was bad in the eyes of law.
18. It is also urged that the third party purchasers are residing in the property in question since last about 40 years and in the given circumstances, the plaintiff is not entitled to the decree of specific performance of contract and, as such, the appeal deserves to be allowed after setting aside the judgment and decree passed by the lower appellate court.
19. Learned counsel for the appellant has relied upon the decision in Ramesh Chand (D) Vs. Asruddin (D); 2015 (33) LCD 2927, Jayakantham Vs. Abay Kumar; (2017) 5 SCC 178 and V.R. Sudhakara Rao and Ors. Vs. T.V. Kameswari, (2007) 6 SCC 650.
20. Per contra learned senior counsel Sri Mohd. Arif Khan while refuting the aforesaid submissions has pointed out that the plaintiff had instituted the suit for specific performance of contract wherein it was clearly pleaded that the plaintiff was always ready and willing to perform his part of contract. Twice he had traveled from Delhi to Lucknow but on each occasion, it revealed that the defendant no.1 had not obtained the permission to sell due to which the sale deed could not be executed. It is also submitted that the plaintiff had already deposited the balance sale consideration with a third party i.e. a neighbour in Lucknow, who was an officer of a bank which clearly amplified both readiness and willingness and in light thereof the trial court had committed an error in recording the finding that the plaintiff was not ready and willing and this finding has been rectified by the lower appellate court based on adequate evidence and this does not require any interference from this Court in second appeal.
21. It is also urged by the learned senior counsel that the lower appellate court had properly considered the evidence and exercised its discretion while decreeing the suit for specific performance for the reason that the house in question actually belonged to the plaintiff who had sold the same to the defendant. Since the plaintiff already had some share in the property and as soon as he became aware that the defendant no.1 was ready to sell, he hurriedly accepted to buy the disputed property from the defendant no.1 and had also paid a sum of Rs.3,000/- as earnest money. In terms of the agreement, it was the obligation of the defendant to have applied for the permission but the defendant evaded to perform his part of the contract and did not pursue to obtain the permission and further behind the back of the plaintiff without informing him and without putting the plaintiff to notice surreptitiously sold the said house in question to the defendant no.2.
22. Learned senior counsel further submits that the defendant no.2 who was residing in the house itself and on the top floor, the mother, sister and the brother-in-law of the plaintiff were residing, he was aware of the agreement between the plaintiff and the defendant no.1 yet he purchased the property and, thus, the defendant no.2 could not be treated to be a bonafide purchaser for valuable consideration without notice. Moreover, the two Courts have echoed the same sentiment insofar as the defendant no.2 is concerned that he was not a bonafide purchaser for valuable consideration without notice.
23. Even while the plaintiff's suit was dismissed and he had preferred the first appeal yet the defendant no.2 did not assail this finding which has attained finality and even while filing the second appeal, no such issue has been raised. It is thus submitted that the plaintiff no.1 without fulfilling his obligation and keeping the plaintiff in the dark, sold the property to the defendant no.2, accordingly, in the aforesaid circumstances the lower appellate court was justified in awarding the decree of specific performance of contract and the plaintiff respondent before this Court is still ready and willing to perform his part of the contract, consequently, the appeal deserves to be dismissed and the decree of the lower appellate court deserves to be affirmed.
24. The Court has heard the learned counsel for the parties and also perused the material on record. Certain undisputed facts which emerges from the record is that the disputed property in question bearing House No.422/20, Tope Darwaza, Police Station Saadatganj, District Lucknow originally belonged to the plaintiff Altafur Rahman who had sold the same to the defendant no.1, Ramzan Ali for a sum of Rs.3,000/- on 25.02.1969.
25. It is also an undisputed fact that even though the disputed house was purchased by Ramzan Ali in the year 1969 yet the said house was occupied by the mother, sister and brother-in-law of the plaintiff who were residing on the top floor whereas the defendant no.2 was residing on the ground floor portion. It is also an undisputed fact that the registered agreement to sale was executed between the plaintiff and the defendant no.1 on 20.07.1977, in terms whereof the defendant no.1 had agreed to sell the disputed house to the plaintiff and had accepted a sum of Rs.3,000/- as earnest money out of total sale consideration of Rs.8,900/-.
26. In the aforesaid background of undisputed facts and noticing the substantial question of law framed in this appeal, firstly the issue regarding readiness and willingness of the plaintiff is to be considered.
27. In the Corpus Juris Secundum, vol. 81 pp.950-951, the readiness and willingness has been interpreted to mean, a general principle of law that a person seeking specific performance must show that he has performed or offered to perform or is ready, able and willing to perform, all the essential acts required by the contract and he must not remain quiet or hold himself aloof so as to enforce or abandon the contract as events may prove advantageous. The plaintiff is entitled to specific performance where he alleges and proves that he has complied substantially with the conditions of the contract or is able, ready and willing to perform the contract. (See also Satya Jain v Anis Ahmed Rushdie AIR 2013 SC 434).
28. In the case of Bijai Bahadur v. Shri Shiv Kumar AIR 1985 All 223, this Court held that so far as the question of readiness and willingness is concerned while 'willingness' is merely a mental process, 'readiness' is something to do with translating that will into action and is preceded by a necessary preparation for being in a position to be ready. As to the averments about this continuous readiness and willingness the law never insists on any particular form and the necessary averment may be made in any language the plaintiff may choose to employ. The language is not important. The crucial thing is that the totality of the averments made in the plaint must indicate the readiness and willingness of the plaintiff, even though by necessary inference.
29. This Court also notices the decision of the Apex Court in His Holiness Acharya Swami Ganesh Dassji Vs. Sitaram Thapar; 1996 (4) SCC 526 wherein the concept of readiness and willingness has been noticed and has been held as under:-
"2. There is a distinction between readiness to perform the contract and willingness to perform the contract. By readiness may be meant the capacity of the plaintiff to perform the contract which includes his financial position to pay the purchase price. For determining his willingness to perform his part of the contract, the conduct has to be properly scrutinised. There is no documentary proof that the plaintiff had ever funds to pay the balance of consideration. Assuming that he had the funds, he has to prove his willingness to perform his part of the contract. According to the terms of the agreement, the plaintiff was to supply the draft sale deed to the defendant within 7 days of the execution of the agreement, i.e., by 27-2-1975. The draft sale deed was not returned after being duly approved by the petitioner. The factum of readiness and willingness to perform plaintiff's part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of the contract. The facts of this case would amply demonstrate that the petitioner/plaintiff was not ready nor had the capacity to perform his part of the contract as he had no financial capacity to pay the consideration in cash as contracted and intended to bide for the time which disentitles him as time is of the essence of the contract."
30. Similarly, In J.P. Builders and Another Vs. A. Ramadas Rao and Another; 2011 (1) SCC 429 wherein the Apex Court in paragraph nos. 22 to 27 has observed as under :-
"22. The words "ready" and "willing" imply that the person was prepared to carry out the terms of the 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.
23. In N.P. Thirugnanam v. Dr. R. Jagan Mohan Rao [(1995) 5 SCC 115] at SCC para 5, this Court held: (SCC pp. 117-18) "5. ... Section 16(c) of the Act envisages that the 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 and is required to be considered by the court while granting or refusing to grant the relief. If the plaintiff fails to either aver or prove the same, he must fail. To adjudge whether the 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 along with other 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 execution till date of the decree he must prove that he is ready and has always been willing to perform his part of the contract. As stated, the factum of his readiness and willingness to perform his part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. The court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of the contract."
24. In P. D'Souza v. Shondrilo Naidu [(2004) 6 SCC 649] this Court observed: (SCC p. 654, paras 19 and 21) "19. It is indisputable that in a suit for specific performance of contract the plaintiff must establish his readiness and willingness to perform his part of contract. The question as to whether the onus was discharged by the plaintiff or not will depend upon the facts and circumstances of each case. No straitjacket formula can be laid down in this behalf.
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21. ... The readiness and willingness on the part of the plaintiff to perform his part of contract would also depend upon the question as to whether the defendant did everything which was required of him to be done in terms of the agreement for sale."
25. Section 16(c) of the Specific Relief Act, 1963 mandates "readiness and willingness" on the part of the plaintiff and it is a condition precedent for obtaining relief of grant of specific performance. It is also clear that in a suit for specific performance, the plaintiff must allege and prove a continuous "readiness and willingness" to perform the contract on his part from the date of the contract. The onus is on the plaintiff.
26. It has been rightly considered by this Court in R.C. Chandiok v. Chuni Lal Sabharwal [(1970) 3 SCC 140] that "readiness and willingness" cannot be treated as a straitjacket formula. This has to be determined from the entirety of the facts and circumstances relevant to the intention and conduct of the party concerned.
27. It is settled law that even in the absence of specific plea by the opposite party, it is the mandate of the statute that the plaintiff has to comply with Section 16(c) of the Specific Relief Act and when there is non-compliance with this statutory mandate, the court is not bound to grant specific performance and is left with no other alternative but to dismiss the suit. It is also clear that readiness to perform must be established throughout the relevant points of time. "Readiness and willingness" to perform the part of the contract has to be determined/ascertained from the conduct of the parties."
31. Applying the principles as noticed above to the facts of the present case in hand and sifting through the evidence of the respective parties, it would reveal that there is a clear statement made by the plaintiff that he has always been ready and willing to perform his part of the contract. In order to amplify the same, it has also been stated that the plaintiff twice visited Lucknow from Delhi to enquire about the permission and to get the sale deed executed and he also made the statement that he had the requisite money which he got deposited with a third party, who was an officer of the Bank.
32. At this stage the counsel for the appellants has contended that if at all the plaintiff had the requisite money then the same could have been kept with his mother and sister, who were already residing on the upper floor of the disputed house and it was merely a sham to indicate that the money was deposited with the third party. In this regard this Court finds that even though the plaintiff was cross-examined but nothing adverse could be elicited from his testimony nor there was any material which was brought on record by the defendant to indicate that the plaintiff did not have the requisite means to pay and get the sale deed executed and moreover the defendants did not challenge the financial capacity of the plaintiff.
33. In so far as the plaintiff is concerned, he deposed and made specific averments including the dates on which the plaintiff had traveled from Delhi to Lucknow for getting the sale deed executed. On the other hand if the evidence of the defendant no.1 and his witness is seen, it would reveal that the defendant no.1 though initially applied for the permission but did not indicate any reason why he did not pursue the said permission nor could he prove that the said permission was refused by the authority for some cogent reason which could absolve the defendant no.1 of his obligation. It would have been a different situation if the permission would have been refused but in the present case, it is found that the defendant though had applied for the permission but did not pursue the same nor took it to its logical conclusion and kept the plaintiff in limbo.
34. The plaintiff has very well established that he had the requisite means as well as his willingness to get the sale deed executed, accordingly, this Court does not find that there is any error committed by the lower appellate court while returning a finding in respect of the readiness and willingness of the plaintiff in respect of the agreement to sale dated 20.07.1977. The first question is answered accordingly.
35. The next question formulated is in respect of the fact as to whether the lower appellate court has incorrectly interpreted the agreement to sale and in this regard the submissions of learned counsel for the appellants is that the agreement itself contemplated that if the permission is applied for and not granted or refused, in such a case the agreement was not enforceable and thus in terms of the Section 20 of The Specif Relief Act, 1963, the lower appellate court was not justified in granting the decree of specific performance.
36. In order to examine the aforesaid submission, it will be relevant to peruse the registered agreement to sale which is available on record. It would indicate that the plaintiff had agreed to purchase the house in question for a total sale consideration of Rs.8,900/- and the sum of Rs.3,000/- was received by the defendant no.1.
37. The basic stipulation contained in the agreement is that when the defendant no.1 would receive the permission to sell from the competent authority, he would inform the plaintiff of the same within a month thereof and the plaintiff can get the sale deed executed after paying the balance sale consideration i.e. Rs.5,900/- and the expenses were to be borne by the purchaser. It further stipulated that after having obtained the permission to sale from the competent authority and within a period of one month if the purchaser did not get the sale deed executed, his earnest money would stand forfeited and in case if the defendant no.1 did not execute the sale deed then the plaintiff can get the sale deed executed through the Court of law.
38. In light of the aforesaid stipulation, it would indicate that it was the duty of the defendant no.1 to have applied for obtaining the necessary permission to sell and convey it to the plaintiff. The lower appellate court while dealing with the agreement found that the plea raised by the defendant no.1 to the effect that the agreement to sell stood rescinded, this was not proved. The basic plea raised by the defendant no.1 to resist the specific performance was the fact that it was the plaintiff who had expressed his unwillingness to get the sale deed executed as he was unable to collect the money and moreover since he was running in arrears of the rent, in respect of the occupation of the upper floor portion of the disputed house occupied by the mother, sister and brother-in-law of the plaintiff, hence, the entire amount of earnest money was to be adjusted towards the rent.
39. In this regard if the evidence is seen, it would indicate that there was nothing on record to amplify any fact regarding the arrears of rent or how much was rent and moreover this was merely a contention of the defendant no.1 without any cogent pleadings or evidence on the said point.
40. On one hand there is a registered agreement to sell between the parties which does not refer to any tenancy nor it relates to any condition that the rent for the top floor is to be paid. There is no document or material on record to indicate that what was the rate of rent, by whom it was paid, to whom it was paid and till when it stood paid. Significantly defendant no.1 also at no point of time ever raised any demand for arrears of rent. Moreover, in this case there is a registered agreement to sell and assuming that the plea of rescission of contract as raised by the defendant is examined then firstly, such an agreement could be canceled bilaterally by a registered document executed by the parties. Moreover, as noticed above, there is nothing in the agreement to sale dated 20.07.1977 which requires any interpretation. The plea of rescission is to be seen in light of the evidence led by the defendant no.1. He has merely brought on record a registered postal receipt alongwith an acknowledgment card addressed and marked as Ex.-5 to indicate that the defendant no.1 had already informed the plaintiff. In case if the defendant no.1 had sent any letter informing regarding rescission, it was the burden on the defendant no.1 to prove the same. It was incumbent upon the defendant no.1 to have prove the content of the said notice which could be done by bringing the said true copy of the said notice on record but it was not done. There is a clear recital that the plaintiff did not receive it. The defendant no.1 in order to establish the same urged, that the said notice was received by Kamrul Hasan. It is also urged that the letter was correctly addressed and was received by Kamrul Hasan and in case if plaintiff was not residing at the given address then the registered cover would have returned but it was received at the given address and it was addressed to the plaintiff and Kamrul Hasan had received it on behalf of the plaintiff.
41. The mere fact that the Kamrul Hasan received the registered cover would not prove or indicate that the plaintiff had the notice of the said letter. In absence of any evidence regarding close proximity between the plaintiff and Kamrul Hasan and relationship of any sort it cannot be presumed that the said notice was served and was in the knowledge of the plaintiff. There is another fact to be noticed that even otherwise there is nothing on record to indicate that when the defendant no.1 knew that the mother, sister and brother-in-law of the plaintiff were residing in the disputed house in question then the information regarding rescission could have been first communicated to them alongwith the plaintiff. Moreover at the cost of repetition it is noted that in absence of the true copy of the alleged notice, mere receipt without the notice and its content being proved cannot come to the aid of the defendant no.1.
42. On the other hand, it would indicate that the defendant no.2 who was residing in the house in question and as noticed by the trial court he had the notice of the agreement between the plaintiff and the defendant no.1 and he was not a bonafide purchaser for valuable consideration without notice and he ought not to have purchased the property. Thus, the plea taken by the defendant no.2 that he had informed the plaintiff of his intention to purchase and the plaintiff did not object, did not find favour with the trial court.
43. The findings on issues no.2 and 4 which was decided against the defendant no.2 was never assailed by filing cross objections under Order XLI Rule 22 CPC before the lower appellate court. Thus, the finding continues to bind the defendant no.2 and he not being a bonafide purchaser for valuable consideration without notice, even otherwise, cannot canvas the plea which is available to the original vendor i.e. Ramzan Ali. His case is limited only to the plea to prove that he was bonafide purchaser for valuable consideration without notice and he failed to prove the aforesaid plea. He further, did not assail the said finding before the lower appellate court. In the aforesaid backdrop the plea of the defendant no.1 regarding misinterpretation of the agreement also does not appear to have any substance and the lower appellate court has dealt with the issue considering the evidence on record and has recorded a finding which is based on proper appreciation of evidence and cannot be termed to be perverse hence, the finding is affirmed by this Court. The second question is answered accordingly.
44. Now before considering the third question, it will be relevant to notice Section 20 of The Specific Relief Act, 1963, which reads as under:-
"20. Discretion as to decreeing specific performance.--
(1) The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal.
(2) The following are cases in which the court may properly exercise discretion not to decree specific performance:--
(a) where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or
(b) where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its non-performance would involve no such hardship on the plaintiff; or
(c) where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance. Explanation 1.--Mere inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b). Explanation 2.-- The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract.
(3) The court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance.
(4) The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the party."
The aforesaid provision would indicate that the decree of specific performance of the contract is a purely equitable remedy and even in case if it is lawful to grant such a decree even then the Court may refuse to grant the relief provided the discretion is exercised in accordance with law.
45. In the instant case, it would be found that the original vendor Ramzan Ali had expired and even otherwise was not residing in the said house in question. The instant appeal is also being canvassed prima facie on behalf of the subsequent purchaser, the appellant no.2 who has also expired and is now represented by his legal heirs. The house in question initially belonged to Altafur Rahman and it is for the aforesaid reason though at one point of time in the year 1969, he had sold it to the defendant no.1 but when the defendant no.1 expressed his intention to sell, the plaintiff agreed to buy. In the aforesaid circumstances where the plea of bonafide purchaser for valuable consideration without notice has not been established, moreover, the conduct of the defendant no.1 of selling the property to the defendant no.2 during the subsistence of the agreement to sale and that too in September, 1979 while the agreement to sale executed between the plaintiff and the defendant no.1 is dated 20.07.1977. In light of the evidence available on record, it cannot be said that the lower appellate court has not exercised its discretion judiciously and this Court is of the opinion that the discretion exercised by the lower appellate court is within four corners and, as such, no error can be found in respect thereto.
46. In view of the aforesaid, the substantial questions of law are accordingly answered. The decree passed by the lower appellate court dated 28.05.1984 passed in Regular Civil Appeal No.67/1983 is affirmed.
47. Before parting, it will also have to be noticed that the agreement to sell is of the year 1977 when the disputed property was sought to be purchased for a total sum of Rs.8,900/- out of which Rs.3,000/- was paid to the defendant no.1. The instant second appeal has been pending before this Court since the year 1984 and almost 38 years have goneby. The prices of the real estate have escalated manifold and this Court also noticing the fact that the defendant no.2 / the appellant must have made improvement in the house in question over the period of years, accordingly, now when the decree for specific performance of contract is to be executed, this Court cannot refrain noticing the aforesaid facts and this Court is also bound to notice the dictum of the Apex Court in K. Prakash v. B.R. Sampath Kumar, (2015) 1 SCC 597 and the relevant paras read as under:-
"19. However, the court may take notice of the fact that there has been an increase in the price of the property and considering the other facts and circumstances of the case, this Court while granting decree for specific performance can impose such condition which may to some extent compensate the defendant owner of the property. This aspect of the matter is considered by a three-Judge Bench of this Court in Nirmala Anand v. Advent Corpn. (P) Ltd. [(2002) 8 SCC 146] , wherein this Court held: (SCC p. 150, para 6) "6. It is true that grant of decree of specific performance lies in the discretion of the court and it is also well settled that it is not always necessary to grant specific performance simply for the reason that it is legal to do so. It is further well settled that the court in its discretion can impose any reasonable condition including payment of an additional amount by one party to the other while granting or refusing decree of specific performance. Whether the purchaser shall be directed to pay an additional amount to the seller or converse would depend upon the facts and circumstances of a case. Ordinarily, the plaintiff is not to be denied the relief of specific performance only on account of the phenomenal increase of price during the pendency of litigation. That may be, in a given case, one of the considerations besides many others to be taken into consideration for refusing the decree of specific performance. As a general rule, it cannot be held that ordinarily the plaintiff cannot be allowed to have, for her alone, the entire benefit of phenomenal increase of the value of the property during the pendency of the litigation. While balancing the equities, one of the considerations to be kept in view is as to who is the defaulting party. It is also to be borne in mind whether a party is trying to take undue advantage over the other as also the hardship that may be caused to the defendant by directing specific performance. There may be other circumstances on which parties may not have any control. The totality of the circumstances is required to be seen."
20. As discussed above the agreement was entered into between the parties in 2003 for sale of the property for a total consideration of Rs 16,10,000. Ten years have passed by and now the price of the property in that area where it situates has increased by not less than five times. Keeping in mind the factual position we are of the view that the appellant should pay a total consideration of Rs 25 lakhs, being the price for the said property."
48. Similarly, the Apex Court in Urvashi Aggarval (since deceased) through Lrs. And another V. Kushagr Ansal (successor in interest of erstwhile Defendant No. 1 Mrs. Suraj Kumari and others) AIR 2019 SC 1280 has held as under and the relevant portion thereof reads as under:-
36. As held by this Court time and again, efflux of time and escalation of price of the property by itself cannot be a valid ground to deny the relief of specific performance. But the Court in its discretion may impose reasonable conditions including payment of additional amount to the vendor. It is equally well settled that the plaintiff is not to be denied specific performance only on account of phenomenal increase of price during the pendency of litigation.
37. The respondent-defendant alternatively pleaded in the written statement that even at the relevant time the price of the suit property was Rs 3,00,000 when the said agreement was executed for Rs 40,000 only. But on the other hand it has come in evidence that against Rs 40,000, the appellant-plaintiff has paid a total amount of Rs 65,000.
38. Be that as it may, in the facts and circumstances of the case and considering the phenomenal increase in price during the period the matter remained pending in different courts, we are of the considered opinion that the impugned order [A. Ramalingam v. H. Siddiqui, RFA No. 265 of 1999, decided on 1-3-2012 (KAR)] under appeal be set aside but with a condition imposed upon the appellant-plaintiff to pay a sum of Rs 15,00,000 (Rupees fifteen lakhs) in addition to the amount already paid by the appellant to the respondent. On deposit in the trial court of the aforesaid amount by the appellant, for payment to the respondent, within three months from today, the respondent shall execute and register the sale deed in favour of the plaintiff in respect of the suit property. In the event the aforesaid condition of deposit of Rs 15 lakhs is fulfilled within the time stipulated hereinabove but if the defendant fails to comply with the direction, then the appellant shall be entitled to execute the decree in accordance with the procedure provided in law.
49. The Apex Court in U.N. Krishnamurthy Vs. A.M. Krishnamurthy; 2022 SCC Online SC 840, in paragraph nos. 38 to 42 has observed as under :-
"38. In this case, we cannot overlook the fact that the suit property is located in the industrial town of Hosur located about 30/40 kms. from Bengaluru. The Court is obliged to take judicial notice of the phenomenal rise in the price of real estate in Hosur. The proposition finds support from case reported in K.S. Vidyanadam v. Vairavan (supra). To quote this Court "we cannot be oblivious to reality - and the reality is constant and continuous rise in the values of urban properties-fuelled by large scale migration of people from rural areas to urban centres and by inflation."
39. Mr. Venugopal argued that the Plaintiff had only paid an insignificant amount of Rs. 10,001/- as advance when the consideration was Rs. 15,10,000/-. Having paid an insignificant amount the Plaintiff was not entitled to discretionary equitable relief of Specific Performance, as observed by this Court in Saradamani Kandappan v. S. Rajalakshmi14. The relevant paragraph of the judgment of this Court is set out hereinbelow:--
"37. The reality arising from this economic change cannot continue to be ignored in deciding cases relating to specific performance. The steep increase in prices is a circumstance which makes it inequitable to grant the relief of specific performance where the purchaser does not take steps to complete the sale within the agreed period, and the vendor has not been responsible for any delay or non-performance. A purchaser can no longer take shelter under the principle that time is not of essence in performance of contracts relating to immovable property, to cover his delays, laches, breaches and "non-readiness". The precedents from an era, when high inflation was unknown, holding that time is not of the essence of the contract in regard to immovable properties, may no longer apply, not because the principle laid down therein is unsound or erroneous, but the circumstances that existed when the said principle was evolved, no longer exist. In these days of galloping increases in prices of immovable properties, to hold that a vendor who took an earnest money of say about 10% of the sale price and agreed for three months or four months as the period for performance, did not intend that time should be the essence, will be a cruel joke on him, and will result in injustice. Adding to the misery is the delay in disposal of cases relating to specific performance, as suits and appeals therefrom routinely take two to three decades to attain finality. As a result, an owner agreeing to sell a property for rupees one lakh and receiving rupees ten thousand as advance may be required to execute a sale deed a quarter century later by receiving the remaining rupees ninety thousand, when the property value has risen to a crore of rupees."
50. In light of the guiding principles noticed above and taking a holistic view in the facts and circumstances that the property in question is located in the heart of the city of Lucknow and 40 years have gone by, thus, this Court finds that it will be just and proper for the plaintiff to pay a total sum of Rs.5,00,000/- to the defendants within three months from the date of this judgment as the total sale consideration and upon payment of such sum to the defendants, they shall execute the sale deed of the disputed house in favour of the plaintiff and the defendant no.2 shall also join with the defendant no.1 in executing the sale deed in favour of the plaintiff in pursuance of the decree for specific performance of contract. In case, if the defendant/appellants before this Court refuse to accept the sum, it will be open for the plaintiff to deposit the aforesaid amount before the executing Court and get the sale deed executed through the executing Court in accordance with law.
51. In light of the aforesaid, the appeal stands dismissed and the judgment and decree passed by the lower appellate court dated 28.05.1984 passed in Regular Civil Appeal No.67/1983 stands affirmed subject to the modification made herein above. In the facts and circumstances, there shall be no order as to the costs. The record of the trial court be returned expeditiously.
Order Date :- 1st May, 2023 Saurabh