High Court Karnataka High Court

S Subramaniam vs R Babu on 18 December, 2009

Karnataka High Court
S Subramaniam vs R Babu on 18 December, 2009
Author: K.L.Manjunath & B.V.Nagarathna
 

IN THE HIGH COURT OF' KARNATAKA AT BANGALORE
DATED THIS THE 18TH DAY OF DECEMBER: . 

PRESENT

THE HONBLE MRJUSTICE  4- _  "  

AND1__ . V
THE HON'BLE MRs.JUs_TIcE'"B,V.NAG.Afe;ATHNA; 
R.F.A.NO."i5 64 /12003-. A  1

BETWEEN: " in ' ' K

SSUBRAMANIAM

S/O LT SAD1YAN_

MAJOR      

R/A # 2683., =4THf _(:.;ROss_, 1gTH- 1»/1:4 .

HALIIS S'iT'AG.EV_ ' 
BANGA;OR£;g5€;4Q:V_Q38,_"'  " "

... APPELLANT

(By Sri: M HOT,LAgsz..  ADVS.]

' .:."1"  R 

G' S HAMACHANDAR R
AGED ABOUT 55 YEARS
 R'/A-.#"'2, NEW ANDHRA BLOCK
,. LAXMIPURAM, ULSOOR
13.AiNGALORE--560 O08

 H GAYATHR1 BABU

W/O R BABU
AGED ABOUT 41 YEARS

R/A # 2, NEW ANDHRA BLOCK
LAXMIPURAM, ULSOOR
BANGALORE--56O O08 

 



 

... RESPONDENTS

{By Sri: AMARESH A ANGADI, ADV. FOR C/R
R-1 AND R-2}

RFA FILED U/S. 96 OF CPC_-*”;’&(D'{AIl\T$lT’-

JUDGMENT AND DEGREE I)’I’.”22«_l 1,103 IN
O.S.NO.10005/95 ON THE FILE THEfivX;'{VIiI.I’ABD’L. CITY

CIVIL JUDGE, MAYOHALL UN1T,*.eANGALoRE–,~ ..(cCc:”H..-V2’siV

DECREEING T}-IE SUIT F0R.s1§Ec1F1r:_, ‘PERF0RM.A1§Ic£;.

This RFA having.beenVAtheai’d and reservedvvvgfor orders
on this day, the NAGARA’.IHI’.JA J, ,pr._Qn_Ou.nced the following:««

This5appea.l”is”ifiledebytlltliie*defendant by challenging the
Judgment _vDe:eflee:D:passed l.i§i”‘e.s.No. 10005/1996 by the
Mayo Hall Unit, Bangalore.

The said was fi1ed’*°l:)y the plaintiffs seeking specific

0fADa’r1″”*agreement dated 12.8.1993. The trial

‘ the suit and being aggrieved by the said

Jzzdgnaenttldand Decree the defendant has preferred this

D . V. aPI3eal.l V

.5 ‘~.

4%. D For the sake of convenience the parties shall be

V hmteferred to in terms of their status before the trial Court.

?>..

3. According to the plaintiffs ‘_ the defendant is the
absolute owner of the property bearing No.2683 situated in
HAL If Stage, BangaIore~38, more fully descritnecfin the

schedule and he had acquired the said site

Development Authority by a registered

8.3.1989 that as per sanctionecifplalni dated’ .i:5′;3fp,.19s9 he 7

had put up a ground floor and firstfloor buildji_ng.*

Development Authority had ‘da.e:livered. p–osses_sionp ofthe site
as per possession certi_iicatei”datv_ed According to
the plaintiffs the plarties _.yme”ta..v”‘through advocate

Sri.H.N.Srini_vas’ Anand ands the”s’ale agreement was reduced

to a VflRs.7,1O,OO0/– and earnest
rnoney_of paid on 26.6.1993. That another
sum of paid on 12.8.1993 and further

Rs.2,2O’O’,’G–0–0/– was paid by way of advance by

‘ .-llB:.E_2;.,i_993a,ifthereby total advance amount of Rs.4,70,000/–

“wast ‘jflizcording to the plaintiffs it was agreed that the

balance; sale consideration amount of Rs.2,40,000/– was to

if ible’«,paid at the time of registration of the sale deed. The

fgdefendant had to obtain the necessary Income Tax clearance

‘certificate from the Income Tax Authorities and the

defendant had also stated at the time of agreement and

assured that the schedule property was not alienated or

55’.

encumbered, but that he had taken a loan from the LIC of
India for the purpose of construction and the defendant had
promised to discharge the said loan amount outhhof the

second advance of Rs.2,00,000/- to be paid

and that the defendant had also promised to ass:ignt V’

of the plaintiffs the amount paid:’bj} ‘tl1e_tenantAlV:i’1i.a_sum.”of T

Rs.1,50,000/–.

4. According to the plaintiffs_}’~ defend-ant’ after the
clearance of the loan ‘secure the original

documents of title.,ancf._’ the plaintiffs. The

defendants lo.anlcum–additional advance of
Rs.2,(l0p,(l00/rover the documents of title and

discharge°certifica._tethe loan. The plaintiffs have stated

wereffreadgwand willing to perform their part of the

‘ ;cont.ra::t’andaocording to them the sale deed wasirqegistered

‘in their’ by the defendant.- That the ground floor of

the schedule property which was in occupation of the

if ideferndant and the first fioor of the said property was in

Afoocupation of a tenant and that the ground floor was vacated

V “lay the defendant and possession was given to the plaintiffs

after entering into the agreement and since the ground floor

was in dilapidated condition, the plaintiffs were permitted to

iv

2′

carry out renovation and repair Work and according to the
plaintiffs a sum of Rs.50,000/– was spent for the same. But
the defendant locked the doors of the ground floor and

prevented the plaintiffs from using it and them

fact even failed to obtain Income Tax clearancejcevrtificattet’

and he did not come forward tom execute f«s_a_le”:Vdee’d.

According to the plaintiffs, ~ den:4a’n.ded,

Rs.18,00,000/- for the S8_]~fL:\”~~K,«)\f then. .sche’c_1ulew’premises

whereas the plaintiffs mvas al.l”a1ofnglVre.ady and”Wi’1Vling to pay
the balance sale considetration.lof:’Rs’Q — on the date

of registration .5_ale;_’deed;:: _Ttia_t.._the”;plaintiff sent a legal

notice ‘dated the defendant, but the defendant
did not cornplv and therefore, the suit for
specific pe’rforrnar;.ce’~.afnd”fpermanent injunction Was filed.

‘ is’e.rv1ce of notice from the trial court, the

‘defendari~tf: appeared and filed his Written statement

adhniittivnghvthat an agreement of sale which the plaintiff was

“c=nt_erevd’ into on 12.8.1993 that he had received a sum of

‘”‘Rs.”7:0,000/~ as advance on the said date and that the sum of

if “”Rs.2,00,000/- was received as the second advance on

12.8.1993, but the plaintiff had failed to pay a sum of

Rs.2,00,000/- towards the third advance as agreed on or

ta

c

M6…

before 30.9.1993. The defendant had handed over the
original documents to the plaintiff to enable the plaintiffs to
produce the documents before the HDF-‘C or other financial
institutions to avail a loan and colnplete the traiisaction.

The defendant denied that in part perform*an.cfe’__’p_olf Jtlie

agreement of sale dated 12.8.1993, posseSSi0lf1~–..wasp’given

the plaintiffs as far as the ground floor’

the defendant had spent huge surns of money for f’its”‘.re’pai1″ag

and renovation. According to ‘Vthpeldefendant’,’ the plaintiff was

never ready and willingpto hi’s..ppart’of contract. In

fact the plaintiff did not with him for

paying the if The defendant had agreed

to seltthe. fi’or_ffa.:llesser price as he was in urgent

need of fu”n.ds”for’setting”up his son’s business. However, in

thfe9.abs:en.ce of Vltrie—-plaintiff coming forward to complete his

3 .»part_of:tl3e»transaction, the defendant was put to loss and

‘Lordship’.n*f’.I’j_ V

2 V» ” 9n the above rival pleadings. the trial court framed the

following issues:

1) Whether defendant proves that plaintiffs failed to

pay Rs.2,00,000/~ as further advance on or
before 30.9.93 as per clause~3 of the agreement
dated 12.8.93′? jg

/’f.

3}

4)

_l7s

Whether plaintiff proves that he was ready and
willing to perform his part of the contract?

Whether plaintiff proves that the defendant
handed over original documents of title to the

plaintiff in part performance of the agreemento_f_

sale dated 12.8.93′?

Whether plaintiff proves that he » is
possession of the ground floor of -the

property?

Whether plaintiff proves that
Rs.50,000/– for carrying out renovation,’repairsfi.

and painting €llC., to tphe_grourid_ floor’? A .

Whether the plaintiff proves that”the”ideferrdant
locked the doors of ground “t3.oor_.” and
prevented the vplaicntiff fron;…_mai=:ing use of the
said ground floor “as. c’On’te1.idedrV:lintpara–7 of the
Dlaint’? – 1

Z’-.VWhethei”,~plaiinti’ff°vp_roves that the defendant

‘demaIV1ded*Rs.Vf2′ vlakhsV.vin excess of amount as per
agreement o’f.’sale–._ to perform his part of the

contr.act’?p

E\?ff\’TnetherAAV”‘defen’dant proves that the plaintiff

‘misei”a_bly failed to perform their part of the

1 ‘ieont1’ac’t—-_and that they did not pay as per the

9)~{

ll}

-a.greeme.rit, as contended in para 8 of the W.S’?

_’.3Vl’;€tt”l’1Ae1′ the defendant proves that he agreed to

, sell the suit property to the plaintiffs for a lesser
price since he was in urgent need of money as

contended in para~8 of the W.S’?

Whether plaintiff proves that he was ready and
willing to pay the balance amount of sale
consideration within the stipulated period’?

Whether the defendant proves that time was the
essence of contract and that plaintiff agreed to
pay and complete the sale on or before 25.1 1.93.
failing which the defendant IS entitled to forfeit

9%

Q’

V8″

Rs.70.000/- paid as earnest as per clause 14(3)
of the agreement?

12] Whether the defendant proves that the plaintiffs’:
failed to furnish the draft sale deed to_”‘th_e.
defendant so as to enable him to obtain income , ‘
tax certificate to convey the suit property”? if f’

13] Whether the plaintiff proveathatphefusold”h.i’s car]; .
to pay the initial earnest s-;um_to jiihe defendant f
and that they borrowed ‘further amount _
security of car garageybyé paying heavy }}1’1’t”Cr€St?

14] Whether defendant proves’ that hoand’ plaintiff
ought to have applied _”to”«.the Ingome” tax
authorities undei*~._Ser.269of,U;–L.Act and U/s
269 of UL Act for§.o}btaining’»»no objection
certificate from Income.’ta:>k: a’11th’-Qifitlés in terms
of the Income T*I”a§§”aVutho;V’it_iesV.iny terms of the
Income taagby1’Act *19E_Si–~as”cont.end_ed in para–12[a]
of the’xv.s3;3__-.i_ ~ 4-

15] Wiiflihefd¢fEndafit…_pr’ovies that the agreement of
salehas. bec:om’e«voi.d and that this court has not
jurisdiction totryfthe suit’?

16);” ” lVVhet1″i’er_ plaintiff proves that he is ever ready

;a_I1d.__ willing’v~ts«’perform his part of the contract
and that they approached the defendant time
“and.v4″%lgain to pay the balance amount of

A “co’nVsidera”tion of Rs.2,40 lakhs?

17′). ..__W1″iei”.her the plaintiff is entitled to the relief
.. prayed for’?

W ‘» 1;8′}–..A What decree or order’?

In support of his case, the plaintiffs, examined
themselves as PW.1 65: 2 and examined PW.3 to 5 and got

marked Ex.P1 to P4 While the defendant examined himself as

f/;’.

,9″

DW.l and another person as DW2 and got marked Ex.Dl to

D8.

8. On the basis of the said evidence,

answered issue Nos.l, 8, 9, 11 toWl.5 in the”ne_gative;,issvue’ » L’

Nos.2 to 4 in the affirmative as Vwell::’as :’iss’i1_e’«.i\ios.lEl;f»,,1ACi’,igl6

and 17 in the affirmative and«..i_ssue’-Nos.5 Eiivill”/”Av.t:{.3a.rtly..3in lthei”

affirmative and decreed the the «.plaintiffs. Being
aggrieved by the saivd-..;..Jl:L1dgn1e;ntll.a–n’d..Debcree the defendant

has preferred this appealtg ‘V

9. “haej;re learned counsel for the appellant

and the learned ‘c’o:_un’s«el”forthe respondents.

is subrnittedlon behalf of the appellant that he had

‘ .V.a’greAe’d:to the suit schedule property only because he was

.’it1″-widirel of funds to set up his unemployed son in

businesslthat in order to meet his urgent necessity, he had

~ agreed to sell the schedule property at a lesser price. As per

Agthe terms of the agreement of sale, the entire sale

transaction had to be completed by 25.11.1993, but the

respondent had failed to comply with the terms of the said

agreement. i.e., though the respondent pleaded that he was

fizz

ready and willing to perform his part of the contract, there
was no material on record to show that he had thebalance

consideration and was ready to pay the same. in–‘jfac_t”;.pthere

were no documents to show that the responden.tT’hla’dihtheqfl

necessary funds to pay the balanceiisale ‘ p.

the mother–in«law of the first respondent

get over the lacuna in the ‘ev_fi’d.e11ce A’ofpP’N_. there!’

was no other corroborativeivewdencel “with_:§regard to
statements made by T .”£’I4i.erefc;re’;’~according to the learned
counsel for theappellaiit’»iIi”thelighttlof ‘Judgments of the

Supreme the respondents did

not havethgiineceislsary.fundsulfor”completing the transaction
and hence they ready and willing to perform their
part of the..obligation: l’~I5le has relied upon certain decision

p.artic}ilarly (il99e;….4 sec 526 and [1978(2) sec 115 to

‘ there is no documentary proof with regard to

.’availabi1ity_ oflfunds to pay the balance sale consideration

the1’1.tl’1e suit for specific performance has to be dismissed.

it » i4fe«..had also contended that the grant of specific performance

the instant case would be in equitous since the appellant

had agreed to sell the property on account of his urgent

financial need to set up his son in business. But since the

respondent failed to pay balance consideration in time the

%

_ A
entire object with which the property was to be sold was
frustrated. That for the appellant the schedule property is

his only shelter and house and therefore, granting-afdecree

of specific performance would be wholly

this regard he has relied upon _Se.c,t_ion

Relief Act.

11. Per contra, learned couriselfor the«_respo§ndent has
submitted that the Ju’dgineI’l_t and ‘Deveree..ppassed by the trial
court does notcall for”anyjinterferen_ce”inthis appeal in as

much as it comply with the

terrnsland asl’_”a”resu1t the respondent could
not ail/ail’ the l.oa’nV’Zat°an”appropriate point of time that there
was no delay’ on of the respondent with regard to

of the'”bal–ance sale consideration. In fact evidence

‘ let in to show that they were ready and willing

“for”lfpayriiejnt:’ of the sale consideration. It is only the

appellvaritvwho did not show any interest in completing his

2 of the obligations and also executing the sale deed in

Algfavlour of the respondent, that the trial court has rightly

‘ answered the issues raised in the instant case which are as

many as 18 in number by appreciating the material on

record in its proper perspective and hence he has submitted

gs.

agreement and a further sum of Rs.2,00,000/~ was paid. All

put together, the plaintiffs had paid a sum of –

and the balance sale consideration to be

plaintiffs was Rs.2,-40,000/- at the time of the ‘V .

sale deed, which according to their agreern-e’nt”:v….,_dated

12.8.1993 (Ex.P~»l) was to be on or before 25.’iei1*__.Ai9_o3._j’; it

also not in dispute that the defendant hadygllclezared the loan
amount outstanding the :IaIvCj«._Vofvl”india after receiving
advance of tjriehlplaintiffs and had

delivered the ;:lo’ctg1ii’1en’:i’s of ti’tle”of.th’e” schedule property.

14. plaintiffs that they were
ready v”and.wiliing* their part of the contract. But

the defendant has “g-flen.ie<l:'i"'"the said aspect by contending that

thefgalalintitls diiiiio-t'Vhave the balance sale consideration

. /- and that they were not ready and willing

to part of the contract. The said aspect would

be considered as point N01. Before considering this aspect

if the matter, it is necessary to extract the relevant portion

the agreement to sell the property dated 12.8.1993

" m{Ex.Pl}. The reason for entering into an agreement to sell the

property is stated in the following manner in the recital of

2.

the agreement: /7*

alglw

“WHEREAS the VENDOR being in need of funds

(C1) to DISCHARGE the LIABILITY OUTSTANDING
with the LIFE INSURANCE CORPORATION
INDIA, in respect of the aforesaid
Property and (b) to PROVIDE himself I” It
for his domestic necessities, has to
SELL the aforesaid ImmovaE;3JteIIPrOper’ty. — = _

15. Clause 3 of the agreement :’=.aI’so states

payments made and receiveIcI–_the AdCf_’€Il:’l§I1’1:t sum of
Rs.70,000/- on 26.2.1993 end:’a–.sum of “Rs..2,o:3,00o/W on
the date of the agreetfient. with the third

advance consideratiorxtoI’be¥paid.t’whieh«e;7e’ads as follows:

agree and undertake to
‘PAY. % Unto’ AI.ijVth:e”1~..j?;3,*NDoR, a further SUM of
Rs:2,OOv,Ooh/;’._(RLI}5EES TWO LAKHS ONLY7. as

I and by of THIRD ADVANCE, for the

_ I E”PftrRC1§.rAsE the SCHEDULE PROPERTY, ON .-

I . 1993,”

regaf;1..e::to the balance sale consideration to be paid.
C1a’1.lSEa’1.4._- reads as follows:

“The said PURCHASERS shall PAY unto the said
VENDOR, the BALANCE of the SALE
CONSIDERATION, at the time of the registration of

/1»

¢s

the Sale deed, in their favour. before the Sub

Registrar, Shiuqjz’. Nagar, Bangalore.”

As per Clause 5 of the agreement, the parties had to

complete the transaction on or before 25.1l..–l’Q93

in Clause 5 in the following mannerzl
“The PARTIES hereto MUTUXSLLY
TRANSACTION of SALE’, i shall ‘be C0MFLE’I}’:’,D,V on;
or before the 25″‘ of Nozfierriber, 1993. it

As a trade preconditionitol’ transaction, the

Vendor viz., the e:_lefen’dant*:;tiad««..agreed’»:.to obtain necessary

clearance the”-1*ncome–tax authorities is as
stated: in ” clause “as follows:

speefiically agrees, assures and
“V undertakes’ to ‘obtain at his cost, NECESSARY
‘ icLE;A,RANcE”‘CERTIFICATE from the Income Tax
_ for the sale of the schedule property

injeuour of the Purchasers.”

.AWithz iegard to the encumbrance of the schedule property

ll –..VVclau;se 9 clearly states about. the LIC loan which the

VA .. _..e1efendar1t had to clear and a sum of Rs.1,50,000/– which

the defendant had to pay to the tenants of the first floor and

the schedule property which reads as follows: [Q
//:t

_ 15 _
The VENDOR fiirther declares and assures unto

the PURCHASERS that he has not alienated or

encumbered the Schedule Property in any

or to any extent whatever, Except to the ‘V’

{a} Loan outstanding withmthe L..-.’;”C’.'”Qf=India;_
which shall be duly Discharged’ from out ,
Additional/Second Advance Of ..1eRse,,2,00;’0o0[;z_
{Rupees Two Lakhs Only) Paid this day,’vos”stated.

above:

(b) Amount of Rs.1,50,,00O/’ {Rupees 2 One
Lakh & Fifty Thousand”Onl.y,’ remaininlgiwith the
Vendor, as uiagg of”~–.Se.curi_ty Deposit in
connection with the.e_’Occuf)ancy/ease–in favour of
the Occupant of…the’-first’ Floor o”fi,Vthe Schedule
Property.’ Lajihichj: “shall” be duly
Ass1gn.ed;}1i717rarisferi’ed in favour of the
Pure-ha”sers.,v~–uvith._the-.Consent_of the Occupant of
theffirsit Floor; be mutually agreed by

Ciause vspelaks” failure on the part of either
pe?141jt3/” in perfortriivhg the contract and the liberty to enforce

it .the seek penalty from the other party. Clause 14

. iS’_eXtr:i<':t,ed "follows:

“Thei~,uPAART1ES here to further MUTUALLY AGREE
the TRANSACTION shall be completed within

the stipulated period stated here in above, failing
O which EITHER PARTY is ENTITLED to ENFORCE

this CONTRACT of SALE, as and by way of
SPECIFIC PERFORMANCE, at the COST of the
DEFA ULTING PARTY. ALTERNATIVELY, the

3;/»«

I

M1″”]_

PARTIES hereto are M UTUALLY ENTITLED to the
PENALTY OPTIONS as STATED ……..

The VENDOR f1:rthe*r agree, assure and
undertake to HAND OVER/ FURNISH Unto

PURCHASERS, the DOCUMENTS of

ORIGINAL, relating to the SCHEDULE PROP.F2RTi’fr’.j’ ” ,
immediately on RECEIPT of the ”

L.I.C. of India, authorities ….{u_)_herein”‘”i’hey’V”are,V

presently deposited), in corlnectionfjyuujith the .’

taken from them, after fully anti” it

satisfying the Loan from ‘them,
period shall not Exceed,:””in_ any case.__beyv(:3>nd :
151″ of Septen1ber;’~ .1 993. VA –. it

conftmis that he shall put his

be”st_4ej”forts.’toAspeed up delivery of the title deeds

” relating .. itovl the Schedule Property, unto the

A E i,Pur’chasers,Htofacilitate the Purchasers, to obtain
,, ., V the Purchase of the Schedule Property,
H.D.F.C or other financial

nsatuttons / Agencies Etc. , .

The Vendor further confirms that the

Additional/ Second Advance of Rs.2,00,000/»
(Rupees Two Lakhs Only] is paid this day, as
aforesaid, to enable the Vendor, to discharge the

amounts outstanding with the L.I.C. Authorities.

%

../v

It is also noted that clause 15 speaks of the undertaking
given by the defendant to deliver possession ofthie

property and the said clause is as follows: _. ~

The Vendor further specificallyAA4pdg;;rees:.’A_’assur-eeltipll
and undertakes to oEr,rVER;’.PossEssi;3i\7 of the”~ ‘
Schedule Property, to “bet sotctv-sjurtto””t31e

Purchasers. in the mannerstctted he’reu_nder:f%

Ct} Actual. Phys1’co,_tfand_ V;ucortt_’p’Possession of the
Ground Floor, on the date the .re_§jt3té’ation of the
Sale deed’ infatfour theAPu_rchasers;

b} Po.ss’esstoln–:’_ of ‘the First, Floor, through

same. from the
Occupdr–it–‘l..ofi _the:”First’ Floor, & as mutually
decided’ agate Parties’;

the staid—-agreement itself there is receipt dated

‘ a sum of Rs.1,00,000/- and another receipt

“satedVle”.j12’;’i993 for a sum of Rs.1.00.000/~ which are

markeld; as Exs.P–2 and P3 respectively. Ex.P–4 is the reply

if dated 12.1995 to the legal notice dated 19.9.1995 issued

if ” ionfbehalf of the plaintiffs.

17. In support of their case PW} who is plaintiff No.2 in

her eXaminatior1–in»chief while reiterating the details of

5%

_ _
payment made to the defendant has stated that the

defendant had availed a loan from LIC and had deposited the
title deeds and in order to discharge the loan with LIC and

get back the original title deeds the advance moneyel..paid by

the plaintiffs was utilised and in Novembe;’;”‘«l19Sj9_{‘5l§. ;_.the

defendant gave the original title deeds. s_Lii:ii”o£

Rs.4,70,000/– was paid and thejiloalance i

paid at the time of execution of J[‘f1€.”d€€C1 aftcrvlVgettii;1g’ithelg

lncome Tax clearance. According toVPWV1c,–v’the;: defendant
delivered vacant posses_si0i:if.'”gf’ i..¢;’hfle.<Vy'VlgrQundvfloor and the
plaintiffs got it repaired ltrierea.-ftehivx.th.e'_'..defendant locked

it andlreiuseld to iilalloilvtlhem tolenter the property. That the
tenantvvas in fii's«t:floo.i~' who had paid a sum of Rs.l.5
lakhs to the defeiidantarid according to PW1. the plaintiffs

agreed to V"tal:–e«'the property subject to attornment of

' lease in their favour. When the defendant was

"asked completion of the transaction, the plaintiffs

were. that he would handover the keys provided the

if plaintiffs pay a sum of Rs.l8,00.000/~. According to PW1.

Atsince the building was in a dilapidated condition, a sum of

Rs.80,000/~ was spent for renovation of ground floor and got

the entire property painted and the damage to the wall was

repaired. According to the plaintiffs. even after receipt of

3/:

rx

EX.P~«él, defendant did not execute the sale deed in their
favour. PW1 is willing to deposit the balance amount in the

court which has been kept ready.

18. In her cross~examination she has”

defendant declined to accept thegthirda Ainstallrne-nt”

her that he would accept .the__ sarne. _ after e’lea.ifanVce lof

dues. She has also admitted’ the loriiginallvfdocuments
furnished by the defendant :..1_;:”993 for Which she had
issued acknowledgement ipisas Ex.D–1. She

has also sta_ted};t1.ia_t..sheihad lonly””rnad’e oral request to the

defendant”t<:{jp;c'alll to'_lle5<'ecute the sale deed and that
she had no that she had kept the balance
amount ready by-_ and that she had paid amounts

Srinivas 'Anand (Advocate) to purchase the stamp

S .-paper.' 1

19: _She_has also stated that she has documents to show

that spent Rs.80,000/– to repair the ground floor. She

lhajlsfllso admitted that legal notice dated 10.1 1.1995 sent by

__the defendant and the postal acknowledgement which were

marked as Exs.D–2 and 13-3. She has denied that plaintiffs

are not ready to purchase the property and that defendant

«':»

,-

M 21 M
does not own any other property or that she has not kept the

balance amount ready.

20. PW2 who is piaintiff No.1 in his examination–in–chief

has stated that Advocate, Sri. Srinivas Anand, introduced

defendant to him and that since the original the

property were with LIC after a sum of

paid by the plaintiffs, the LIC io’an”was ‘the 9 T

defendant and the documents wferefgiyfen if

time, the house was in a dilapidated “co_nditio;_n ‘after the

defendant handed over the.i-‘keyps– of__the «suit property, he

renoj?ated’ethVe_ ofuthev same and that the tenant
was atfirst the defendant had taken a sum
of R_s.1.50’=.lakh that the plaintiffs would pay the

to the ‘tenant and the remaining sale consideration

V to the defendant. That after repairing the

f’ the property, the defendant locked the house

and ..too._kVaway the keys. That a sum of Rs.80,000/- was

spent on the said repair. That though PW2 stated that he

fgwould pay Rs.2,00,000/– more, the defendant demanded

H Rs.18,00,000/– for the suit schedule property. When the

balance sale consideration was offered to the defendant to

complete the sale deed. he did not do so. That amounts were

/Ea

M 22 M
paid for stamps for completing the sale deed. According to

PW2 he is willing to pay the balance amount for execution of

the sale deed.

21. in his cross–examination, he has stated not

pay the third installment on 30.9.1993 sinc_elv_fthe’

did not give him the papers by the dated jalsie)

stated in the cross–exarnination that he does.’t.l,n.ot have any

document to show that he 2 .50 laiihl’inf-hisfaccount to

pay to the defendant. ‘He pdeniedfthllat he does
not have any balance sale to be paid to the

defendant”or{f,thatfVhe to perform his part of the

obligation under agreernrsnt.

22. PW3_ is the 4liTI1O’l.Llfilii.i;–I”–i1’l~laW of the first plaintiff and

rnotheriiof thel”sec:ond plaintiff who has stated that she knows

theftransaction between the parties and that the

.det’endaf1_t,l___ha’d”‘given the keys of the suit property to the

plaintiffs “after receiving the advance and the plaintiffs had

..spentl’rnoney for the renovation of the property, but the

l’z_ld’efe-‘ndant forcibly locked the schedule property and later

* Jdernanded Rs.l8,00,000/–. She has stated that the balance

consideration which is to be paid to the defendant is with

fig’ V

_i23_i

her and that she is ready to pay the amount at the time of
execution of the sale deed. In her cross-eXarnination, she

has denied that the suit property was not renovated.’loy_ the

plaintiffs or that the defendant had not taken_ayyayi.l_tl”ie:ls:ey’s

or that she does not have the balance con.sider§1tion: amount.»

to pay to the defendant.

23. PW4 is a person known tofthie the

defendant, has spoken about__t_h:evVtransactionyandilhas stated
in his–examination–in;nhief: poi’ affidavit that the

ground floor was vacated» and first floor was occupied by

tenantlland fullllydarnaged and not in a good
condition the plaintiff that it is not worth
Rs.7,00,9@Ol/’– , V lB._uti~the…lplaintiffs had stated that the area is

relsidvential area and hence, they agreed to

‘ ,.p’urcl”i.ase;’th:e schedule property with an intention to get the

” repair Worjlclydone and alter the house according to vastu. He

stated” that on 26.3.1993 on the date of the inspection of the

if if placegthe plaintiffs advanced a sum of Rs.70,000/- towards

sale consideration. That in the office of Sri.Srinivas

Anand, Advocate, the sale agreement was executed on

12.8.1993 and he had signed the agreement on that date as

a witness and his signature is at EX.P–2[g). That on

5.

M24,

30.9.1993, when the plaintiffs and Sri. Srinivas Anand,
Advocate, Went to the defendant with a sum of Rs.2,00,000/-

by Way of third advance, the defendant pleaded ii-n_:ability

to pay the loan amount and get the original and

stated that he required sometime to get the~’loa:n

and get the original document. Thereafter:4.the”de’fe.nd1ant

handed over the originalyfdo_cumen_t” on

possession was handed ovef”‘i’c;_{‘15.121993’onlgwhich day
the defendant receiv’e_d”‘~«a :«.R.sv;’l«,.O0,00(j/ by way of

Cash and another supnfil on 16.12.1993

through pay” fdr Which'”‘rec’eipi’s..:he’had signed as a

witnelssf” hadptherefore, received a sum of
carried out the repairs of the
ground poiitions including kitchen which was badly

daihaged __andhVrep1aced the tiles and painted and suitably

‘ ;.alterevd4V’andj”‘repaired by spending a sum of Rs.80,000/-

“ivliichVrepjairr1’vvas completed in May 1994 and that they had

engazged s Savita Furniture and Home Repairs and after

2 Althea renovation, the defendant demanded higher

Altconsideration of Rs.18,00,000/- in place of Rs.7,00,000/–

whereas the defendant was requested to register the sale

deed after taking the baiance sale consideration amount of

Rs.2,-40,000/– as agreed, where as the defendant locked the

1/3:.

,25_

ground floor portion and forcibly dispossessed the plaintiffs
when the plaintiffs had paid their hard earned money to the
defendant with an intention to have shelter of his Vo\}vn’;c._fi’hat

the proprietor of M/s Savita Furniture and _n’om¢~

who repaired the schedule house, of

October, 2002. In his cross~exar1r1ination., dhgeihas 4stated..rAth,at ‘

the first plaintiff is the son~;in–lavvA_o’f his £1e”1~.a:s_

denied that defendant did not.:handover_ ‘possession of the
ground floor on 15.i§?,;~~1g_993″or:Athat.Tpiaintiff renovated
the suit property. He has defendant had

locked the su’i’i’««g.rpfropertyg was made by the

plaintiffs’ ‘and thetamoudntvtvvas paid to Sri. Srinivas

Anand,gAdvocate:i”or stamp paper.

Murugesn Swamy has deposed as PW5 as a

‘ .i.p”ersgon_Vwhoiddwas attached to the Proprietor of M/s Savita

Home Repairs, Uisoor, Bangalore and had

carriedion the repair in the ground floor of the premises. He

2 V. Adhasyalso given the details of the repair in the month of June

and that the defendant used to visit schedule premises

‘to see the renovation work. That in the second week of June

1994 or in the evening hours after work the defendant had

locked the premises by removing the earlier lock and that

—27-

26. On the basis of the aforesaid material, it is necessary
to consider the readiness and willingness on the part of the
plaintiffs to perform their part of the contract. ‘I’he’:capacity

of a party to perform the contract includinggthej;finan;ci~al

capacity to pay the purchase price is

conduct of a party would indicate if

the contract. While appreciating’readiness

on the part of the plaintiffs, regardfto-unonivpayment of
the requisite sale consideratiolngr tobeappreciated
IS the fact that the plaintiffs’ to pay the sale

consideration.’dinporder”to”p:proVeVf”that the plaintiffs had the

requ1.sitei’bal’apnceifisaie”‘consideration, it is not necessary that
the said fact’ h.as*:t’o« by documentary evidence. It is

sufficientfrom the Aoralv.–eVidence that it is established that

thee. plaintiff …. the funds to pay the balance sale

‘ ;cons1dVeration*..__En this context it is necessary to see that the

‘total consideration for the schedule property was

Rsfli and a sum of Rs.4,70,000/– has been

“aceepteld by the defendant and out of which a sum of

l”«i2sl..l’A2A,00.0O0/«~ was utilised by him to pay of the outstanding

if “debts with LIC of India and after obtaining the documents of

title to the schedule property for the clearance of the said

land, the said documents were also handed over to the

§«

Wggm

plaintiffs by the defendant. According to PWI, the plaintiffs
had the funds to pay the balance sale consideration and

according to PW8 the mother of PW2, she was ready-…yto._pay

the said amount at the time of registration ofclieedv

as she has the requisite fund. In fact, PW:&”whof_vis’V’one.o1’the .

witnesses to Ex.P–1 has stated that :l’1e..”I°ldyo’:Vate

Sri. Srinivas Anand requesteoflthe defendant: ‘to; register lthe”

sale deed by accepting the vbalance sale: consideration of
Rs.2,40,000/–. But –t.hei– defe_r_1r_ian.t who did not come
forward to do so. I I I

27. On other established that out of
Rs.7,oo,o0o’/i._,V’ Rs.4,70,000/- which is a
substantial. portionffopf sale consideration had been paid

‘itheffyplaintiffs ‘an-dfia balance of Rs.2,40.000/– only had to

I time of execution of the sale deed. In fact, in

.’tefxns oi’.fC_laeuse 14 of the agreement to sell, the defendant

was ..toAhandover the original title deeds to the plaintiffs after

reteiving the same from LIC of India on clearance of the

A”§o1′.1tstanding with the help of the advance amount paid by the

I plaintiffs and the original document was to be made use of

by the plaintiffs, by producing the same before HDFC Bank

or any other financial institution so that the loan could be

5,

,/f.

availed to pay the amount to the defendant. In fact, Ex.P–1
is the acknowledgement of the title deeds by the defendant to

the plaintiff, on 20.11.1993, which was only ‘five

to the date agreed by the parties to complete.utransaction,

Although the agreement stated that title ‘

handed over by the defendant to thehplaintiffs-V.tofobtaignuloariit

for paying the balance sale co’n:sideration_ same was
also handed over, onltheefplaintiffs to
do so if he could = other manner.

Therefore, that Vayfailed by the plaintiffs
from even after the receipt
of would not imply that the
plaintiffs’ had they had failed to make use of
the title the loan. Since it has come in the

that “F”W3.,…tne mother-in–laW of plaintiff No.1, had

‘ ,,the. requ*isi<t.e" funds to pay the balance sale consideration.

a "It, also contended by the plaintiffs that they were put

2 Afiiixpossession of the ground floor of the schedule property

that they had spent considerable sum for carrying out

repair and renovation work, but subsequently, the defendant

locked the ground floor and prevented the plaintiffs from

making use of the ground floor. It is seen from clause 15

%.

zf;/7*

n30n

that possession of the ground floor was to be handed over
only on the date of the registration of the sale deed. But it is
the case of the defendant that possession of the grotfnd floor

was not handed over to the plaintiffs. Howe§ver;p&’pp13:lN’s.:.l”,’,2

and 4 have deposed that the defend_a;1f!””..Vyhanded ffoverffl

possession of the suit schedule jpropiefrcty to on if

15.12.1993 and the plaintiffs ‘carried o.Lijt.’I’e:pairf.”‘andpp

alteration work and PW5 haspstated that”th.e plaintiffs met
the expenditure for eailterationflanid rep.air andthereafter the
defendant locked the pfrernisfesff to this evidence,

the defenda_nt’:ha-s placied«.Va:iyfi~eyidfence to contend that

the grolundyiflioorff not-in a’.di’Eapidated condition and it did
not that possession was not handed
over to plvaintiffs..Vor«..t’hat no repair work was done by the

p_laintifi’s in the prerriises. in fact, in the cross–exarn1nation

‘ ;fo*f.eVPWVsL’lf,”Qfand 5, nothing contrary has been elicited by the

therefore there is no reason as to why the

contention of the plaintiffs that possession was handed over

” tioathefitn by the defendant and that they had carried out

“‘i.f:=,pair work in the ground floor of the schedule property and

“thereafter, the defendant locked the ground floor and

demanded higher sale consideration cannot be accepted.

5%»

‘ 9

_ __

29. In fact, it is the case of PW1 that the defendant had

demanded a sum of Rs.18,00,000/~ and therefore, he had

refused to execute the sale deed by stating that the..pr_iceV_has

risen unless the plaintiffs paid a higher

execute the sale deed in favour of the plaintiffstlifij la.

has also stated that the market:=__vVal:u.elA.

increased and he is not ready-to execute any”sa1e4_deed niowl.’H

In fact, even PW2 has stated he requested defendant
that he would pay additional confsi<:lera'ti.on of lRsN.2,O0,O0O/-,
but the defendant denA1_and.ed.vlV_a ~:.Rs–}18,00,000/–. The

stand taken:_"bfp;jptl1e defendant"'inV 'his..ei}idence would clearly

indicatellfVt'l1ai'l¢,tlie7fdefe'ndantlwasflconscious of the fact that
the price of the~:'gé'clied_Ltile:'property has risen and therefore,
unwillingness on._tli~es of the defendant to execute the

sale can"'be….infer1'ed, although the evidence of the

V they were willing to pay the additional sum of

if as sale consideration is not corroborated.

30.. It «is the further contention of the defendant that the

.A pplaintiffs failed to perform their part of the contract and

l f’t»herefore, when time was the essence of the contract and the

plaintiffs had agreed to complete the same on or before

25.11.1993, the plaintiffs in the absence of making the third

)1-

/3

n32n

advance payment within the said time are not entitled to the

relief of specific performance. But what has to beebsleen is

that the defendant handed over the documentsjof tdthe

plaintiffs only on 20.11.1998 and defenda.ntv_Al’:f~e;as:.A_fio’_where9″x_

stated that he had obtained

certificate from the Income tag; Authorities and by doing 1

so the sale deed could and
neither has the defendant evidence
that he had made arrang~eAmen’ltsvto–=get.’t~he_i.tenancy rights of
the first floereeietgfied so that when the
tenant would pay a sum of
Rs.1:’50;lOO9.}f,~:v toiifittriefltenantslfl”Therefore, the defendant has
committed Jcohntract by not performing the
0bli_gatioh”s..Which._ “A71:-‘._Ib’le”~~l<.l*'ast upon him under the agreement.

fact even aftervthedate set out in the agreement regarding

9 :.lp'a3rrneI:it ivofrthe third advance, the defendant accepted the

"same eh'–".j':s.:i2.1993 and 16.12.1993 which is beyond the

time. for completion of the contract i.e., 25.1 1.1993 and

it therefore, it has to be implied that though the date for

Algcompletion of the agreement was mentioned in the

'agreement both the parties had given up the same and

therefore time was not the essence of the contract. It is also

to be noted that in the absence of income tax clearance
£5;

certificate the transaction could not have been completed as

it would have otherwise resulted in penal consequences. In

. fact, even when the title deeds were handed overgthe fact

that permission was obtained from the

authorities to execute the sale deed by the is

established. In fact, nowhere it”;has”come -:one:_’r:ecord’Vwith if

such a permission was ever obtained by the defendant;–‘

31. On the other .l_1and;’lthetidefenpdantfhad ‘made use of
the advance amount.’ fpl=ain.tiffs to get the

document release-d of°Ifndipa’a:t1d has submitted to

the ptlaint’iff5t};. in abseunce of further performance of
the obligations I bj(e«.the..f_’defe.i1dant the transaction could not
have been. taken to logical conclusion. Though, the

hadV’giv–e~::«’the title deeds to the plaintiffs, he got

‘ seeking return of the title deeds which act of

‘thief defenxstant has to be construed as an expression of his

own unwillingness to perform his part of the contract. In

If » nfactit has come in the evidence that the plaintiffs were ready

willing to perform their part of the contract. But until

‘and unless the defendant had obtained the income tax

clearance, the sale agreement could not be registered.

Therefore, the defendant cannot allege that the plaintiffs

éar

m34_

were not ready- and willing to perform their part of the
contract. On the other hand, it is to be held that the

contract could not be concluded between the parties. on

account of the non–performance of the obligation’Vibylfthey

defendant and that the plaintiffs were ready__pa1a.d _

perform their part of the contract.

32. At this stage it is necessary to regfe’r:’to” cl.a.1’1se’=,

(3), (4), (5), [8] and (9) agreem_e’ni;”,V.= tfijiolaglh in if

clauses (3), [4] and”.,__{5) stated ‘thaththe third
advance of Rs.2,00,000/’bio on or before

30.9.1993 and balanceifconsideration was to be paid at

the time §a;1’e”deed and the transaction
was to be lcomp.1ete’cl«.Qfi.o:r*- before 25.11.1993, it is necessary

to note that. the 3¥’d’Aad’vance paid in December £993 was

by the ‘defendant and the sale deed was to be

reg’1ste1″ed’isubject to the defendant obtaining necessary

clearance ‘Vecrtificate from Income Tax Authorities. As far

as th.eiWplaintiffs are concerned, they had completed their

if part«.of the obligations under the contract and it is the

defendant who did not get the necessary Income Tax

llnhfuliearance before 25.11.1993 so that the sale could be

completed. On a reading of the various clauses of

the contract and the conduct of the parties, we

5%.

c35_

find that the plaintiffs had performed their part of the
obligations and were ready and willing to perform those
obligations at the time of the registration of the sa:le»cdeed.

However, it is the defendant who was not ready—andl__i’wil:l’ing

to perform his part of the contract. ‘Iherefore;–..point llisl

held in favour of the plaintiffs and againstithe’defendant; J

33. With regard to point l\l?o.. concernecli, Cection 20 of
the Act states that” ~..the .jurisldictlio.n to ‘decree specific
performance is discretioriaiyg’lt:’says’–,that_j_the Court is not

bound to gran-tyyjstich’V.mere’lyj_beca;1se it is lawful to do

so. fSluch– dis’cfietio.n’.’ however. is not to be exercised
arbitrarily, but ‘zfi1eustv._.bie.,4b.ased on sound and reasonable

judicial ll principleslfill Section also specifies the

circuirlstances linvwhi’ch the Court may properly exercise the

‘ ;.discretion_*not«_ to decree specific performance and it also

“specifies’~lwh.en, in an appropriate case. a decree could be

given by proper exercise of discretion. Section 20 is not an

2 if exhaustive provision, but merely illustrative as it is not

Cpossible to define the circumstances in which equitable relief

‘could or could not be granted. If, therefore, on a

consideration of all the circumstances of the case, the Court

thinks that it will be inequitable to grant the relief asked for,

3;»;

it should not give the relief. In this context, it is necessary to
refer to explanation to Section 10 of the Act provides that,
unless and until the contrary is proved, the Cou:rt»,shall

presume that the breach of a contract to transfer.

property cannot be adequately relieved by”

money. But the said presL;”mption,_v His-S f’–rebuttable if

presumption.

34. Sub–section [,?;)~.__ of specifies certain

circumstances when dis_c’retioi*1:’ may’ ‘exercised not to

decree specific,’ ‘performan¢::e;.,V”~..”]?]riese:’ circumstances are

illustrativeesaiiid cfangbe as followsg

Ii) ._ V . ternis of the contract or the

‘ con’duct”o.f the parties at the time of entering

” into Acor:~–tract or the circumstances under

_ _which’the contract was entered into are such

ti’iat—«*’they give the plaintiff an unfair
advantage over the defendant.

A ~.’ii’}._ ffV.~”Where the performance of the contract would

1′ involve some hardship to the defendant
whereas, its non–performance would involve
no such hardship on the plaintiff.

[iii] that it makes it inequitable to enforce specific
performance.

35. While explaining these circumstances, EXpIanation–1

speaks about unfair disadvantage. Explanation-IE relates to

hardship which is a circurlastance in favour of téie defendant,

/3

M37″.

while Explanations-Ill and IV are in favour of the plaintiff
when in a case Where the plaintiff has done substantial acts

in consequence of a contract capable of specific perfotfinatlce

or refused specific performance, merely because theVlcoritr_act’~ 4_

is not enforceable at the instance -of”tl3-epdelfendarlt’, if

36. As far as Point No.2 is coricerned,j. it._is” the co’ntention l

of the defendant that he required money on urgent zbasisland be

therefore, had agreed to sell tlieilsiiiit property for a
lesser value since re_qui_reld_ money tolldischarge the
liability outstanding with respect of the

veiyischedeule tolprovide himself with fund for
his domestic had offered to sell the property.
The sarnle”‘«i.s Ex.P–1. It is contended on behalf

defendant in the absence of the plaintiffs paying

‘ sthe _b’alan_ce:ls–ale consideration the defendant could not set

” upihis business and therefore, the defendant suffered

not only by selling the property at a lower market value, but

also on account of not being able to set up his son in

llgblusiness at an appropriate time since the plaintiffs failed to

‘pay the balance sale consideration and conclude the

contract. The said submission cannot be accepted for the

reasons that the defendant: on receiving the substantial

/5/

n—- 38 I-4L!

portion of the sale consideration had utilised the advance
amounts to discharge his LIC loan and release the
documents. If really the defendant required the balafice sale

consideration of Rs.2,40,000/– which would haizeé’ patid

at the time of registration of the sale de_edv,fth’en’

defendant ought to have been taken step_s’l–.in 7

that the income tax clearance other obl:igationVs:.:.which

were required to be performedillby hirnunder,theagreement
were performed in time so cinild recleivethe balance
sale consideration to le>l:e_cuteV.lth’e and utilise the

funds on settir1g._1ip But what we find

fromgthe factlvlthlat the defendant no doubt
utilised the consideration for releasing the
docurnentalandlhandirigiilover the title deeds to the plaintiffs

the of obtaining permission from the

‘ «authorities by the defendant the sale transaction

concluded and therefore, the plaintiffs cannot

bellbplainedllfor the said reason. if indeed the defendant had

“t’a}genl”steps in right earnest, then the plaintiffs were duty

to pay the balance sale consideration and get the sale

“deed executed in their favour. In the absence of the

defendant acting in accordance with the terms of the

3.

/5

agreement, the plaintiffs cannot be blamed for non»

performance.

37. The contention of the learned couie’i”sell.f..fl__(_l:)1l”5;_.the

defendant that under Section 20 of the ::R:e1iefllAct,l

the defendant is entitled to the ‘

contract gave an unfair padvantagelwto thel. p:laintiffs’t one?

account of the low sale consiVderat.ion fi’Xed”‘in-I the agreement

in question cannot vb3e~~..acc_e’pted— inlview of there being no

material evidence on record market value of

the agreement”toV:’sell§was h;igher”tha.n__tlie sale consideration.

It isalso to’~.note inadequate consideration IS
not a”;re-ason.toinldenyyspecific performance. Similarly, the
hardshipthat would, ’caused to the defendant in case the

suit. isidecreed also be accepted for the simple reason

‘ Lyltiiat :’de”fe.ndant has taken advantage of the sum of

” l–l paid by the plaintiffs and thereby has got his

LlC yploanhlddischarged and the defendant himself is to be

if blamed for not concluding the contract within a reasonable

so that he could utilise the funds for setting up his son

” 1n the business. ,1

-40-

38. Therefore, the plea regarding hardship of the
defendant or that this is the only shelter he has cannot be

accepted.

39. Similarly, the equities are more iI1″”f%1V0:1V’;tI’VV”(Z>”‘f i’theV’

plaintiffs so as to be entitledj’to”‘a« g_d’ecree:Ah’foi’ Vvspecific

performance inasmuch as they:__ 2

Rs.4,70,000/– out of the sale @611side1?au;m..pf,as:.};’o’o’;ooo/9;’
to show that they cou1d..’acquire suit sched’ule”property at
the relevant point of Ii’e.th’e:’de’fen’daii–t. had taken steps

to perform his _ther.s« the plaintiffs would

haveV’ip’aid”the baifai1cle~.s’alte consideration and get the sale
deed executed. iri.’Vtheir_. In the absence of the same,

the _p1aintiffs’vha\/fe opportunity of buying the suit

scf:’:_ti’e<:l1;1_?le propertyva-t"the relevant point of time and further

' ;o'n~acc_o'un't.ggofsteep increase in the price of properties in

plaintiffs would not get the property for the

same rate. Therefore, it would be equitable to enforce

» xspecific performance. I-Ience, point No.2 is answered against

A' "theappellantwdefendant.

40. In 1999(3) Kar.L.J. 677 (Y.N.GOPALA RAG vs

D.R.LAXMINARAYANA AND OTHERS) it has been held by

3.

/3

IRS» 41″ I-CIA
this Court that the presumption in a suit for specific

performance is that a breach of contract cannot be

adequately reheved by compensation in money«j”arid_f”‘that’

contract can be satisfied only by conVeyanc.e”–«ofApaafticularg

estate contracted for sale

rebuttable, and the burden of :’reb1,itting

opposing enforcement of contract and wheref..suci1–V.party has i’

failed to rebut presumption, y_s_tfii”t_f0r_y_vspec’ificperformance is
to be decreed agains’t.l:suAch principle is also
stated in Explanation.-‘fi’)v»t.ow of Section 10 of

the Specific A”~’1.Ci-..”‘. if
4}. VV.WhileVadvertirigjto__:Secti’on 20 of the Act, it is stated in
this decision _thgtt_ irigprice is no ground to refuse specific

pesiforr11ancef’faVndv_ the refusal may also have tendency to

.’ :cause:hardshi_p in the plaintiff in acquiring such property or

_ othierwxat such time.

it in AIR 2004 so 909 (M.S.MADHUSOODHANAN AND

‘ANOTHER vs KERALA KAUMUDI P’VT.LTD., AND OTHERS}

“fit is observed that the guidelines for the exercise of the

Court’s discretion to decree specific performance of an

agreement have been statutorily laid down in subsection (2)

£

ii”?

_,42M

of Section 20 of the Act and that, in Explanation 1 to Section
20, it is stated that mere inadequacy of consideration, or the

mere fact that the contract is onerous to the defen-d_an_t or

improvident in its nature shall not be deemedljto”conlistiiute

an unfair advantage Within the meaning”‘of…:clause<– [a)__'org

hardship within the meaning of clause. {S

43. {LR 1992 KAR 717 [YOGAMBIKA v
relied upon by the responderitpiltopcontend that “‘rnére fact

that a person is a retired G.o\?e1*n1nen.t. servant cannot at all

be considered to be a lVla_ili’dl’itofrgebfugse to enforce the

contractl” ‘hell’, ‘V’vo’l’uri’i;aril:tf””agreed to and that, under
Section of grounds which enable the Court to
refuse togranta’vdeCr§;’e.–~fnust be such which were not in the

c.o_ii.teE:nplation”‘of~—-the parties when they entered into an

S sale and also that the defendant had no control

.’ oifer tbosej_ grounds and as a result of those grounds, it has

belcorne impossible for him to get on without the property

agreed to be sold.

The decisions cited at the Bar are referred to as

follows: Learned counsel for the appellant has relied upon

several decisions in support of his contentions: Z;

./5

‘ ‘V is

_ 43 _

AIR 2001 SC 2783 (A.C.Arulappan Vs. Smt.Ahalya
Naik), (199915 SCC 77 (K.Narendra Vs. Riviera
Apartments (P) Ltd], AIR 1997 so 1 751 [I{.S.Vidyi1fiadam

82, Others Vs. Vaircwan), AIR 1982

(Smt.Ranganayakamma Vs. N.GovindqV__pl’VaraZg’ar1]i

(2000) 6 sec 420 (Motilal Jaiiiiililfsl.’ ~1zamazc.~$;i”«.r;ge;}ij”i1aire 7

been cited to contend that thereisfundue.:h:_ardsl1ip:.4.t(3.theL

defendant or there is astronoinical rise of the
properties and if thereis a .:ie’1a;}I’~fm”r:iing a’sL1i.i;” for specific
performance which wotxfid “rp.e§1«:e to grant the

decree, then specific §perfoijmanc.e*i.ou’gh:tnot to be granted.

These ‘dec’isioV’ns gifge’ not to the facts of the present
case ‘since ‘we: against the appellant on the
question ‘of. hard V’

SCC 526 (His Holiness Acharya Swami

“swash Vs. Sita Ram Thapar} and [1978 2 sec

116.. [:S1nt.Sandhya Rani Sarkar Vs. Smt.Sudha Rani

‘ ~ ibiebpi 82. Others) have been cited to contend that readiness to

‘perform the contract would mean that the plaintiff has the

‘Hfinancial capacity to pay the purchase price and for which

there must be sufficient proof that the plaintiffs had funds to

55
/:1

__44__

pay the balance consideration. On this aspect of the matter

we have held in favour of the respondents. H.

46. AIR 1996 so 2314 (Lourdu Mari David Vs”.””Louis

Chinnaya Arogiaswamy} has been relied

that specific performance being an equitable”‘re.lic:f:’Vrn’us[ tug 3’

granted to a person who approaches’the*<.court wit.h"'clean

hands and not to one who makes fals:e.Vallegatjv_ons. '

decision has no relevance to tizefacts oftherrpresentllcase.

47. In AIR 1987 SC 2328 g_[1?dr<;i<:1,L_»nnan" Veettlvi Joseph's

Son .Mdth°c;j}t',Vs!iififilecturnbarzfitllvfftivruvila's son and Others},
it haszbeen stated»':th_at..tlt1-edcourt is not bound to give specific

perforrnance 'rneVrely"–because it is lawful to do so and the

gshould taKe———-sare to see that it is not used as an

V 'oppression to have an unfair advantage to the

lplaitntiffsdf the instant case however by not granting the

relief. olfispecific performance to the respondents would create

2 :1' ~ Alpanainfair advantage to the appellant vendor.
With regard to the readiness and willingness (1999) 7

" "SCC 303 (Ramkumar Agarwal 82. Another Vs. Thawar

Das (Dead) through L.Rs], (1995) 5 SCC 115

E»,

W45…"

(N.P.Thirugnanam (Dead) by L.Rs Vs. Dr.R.Jagan Mohan
Rao 82. Others), AIR 1928 Privy Council 208 (Ardeshir

H.Mama Vs. Flora Sassoon], ILR 1993 KamaVt@.I§’a._V_427

{DB} (Saraswathi Ammal Vs. V.C.Lingam] _(;fi’ct

KLJ 186 (G.M.Chinnaswamy Vs. have

been cited to contend the C’;ontiniao1isg ‘:readi’n.eg§ ..,and

willingness on the part of the hp-1ain.tiffs :c0r;.dition’,

precedent to grant the reliefs» specific ‘perf0r:1;1ance and
person who falsely claims ca sumldofflvmoney and

attempts to prove the plea at itrialistageicannot be said to

be readyiVand5,uIilli:hg topay theflsurn due under the contract
in question. V Fro1n’the«.ei?’idei1ce on record we have come to a

conclusiori”..th’atgtherrespondents were ready and willing to

their paitofthe contract and therefore this decision

‘ has n’o._relevan::e to the facts of the case.

49.2 .. A13’ 1961 Calcutta 359 (A.E.G.Carapiet Vs.

it iAl.iY,De’rderian) and (1971) 3 SCC 273 {Amar Singh Vs.

State of Bihar) have been cited to contend that when

i there is no cross–examination on crucial aspects. then the

testimony of witness has to be believed. Having regard to the

It
,4.

evidence on record, the said decision is not appiicabie to the

facts of the present case.

50. Counsel for the respondent has relied upon ILR 2000

Kar. 3536 (C.Nazeer Ahmed Vs. S.Jahan Ara) t,oVc_o’ri.t¢nd

that circumstances sufficiently strong couId__;’_’di’sp.l_acer.

ordinary presumption that in any contractV—-f0r:”.sai*e: of land. 9

stipulation as to time, is not of essences. }In–,the.’in.stant case,

the fact that the third advance4__wasdi°eceived dappeiddiant’ 3,

herein after the stipulated ddaterand :fi~-:.:§E::”‘:afté;;- the date

contract implies that both parties

did nottreat dtheessence of contract.

51. (2000) 6’=SCC’ 420 (‘Motflal Jain Vs. Radasi Devi 82.

Othe’r*s) has-» been cited to contend that where a major

.pvo’1*tioEn:’ofVd’the consideration (two–~thirds in the said case} was

I ipaidd the of execution of the contract, it was held that

re-adinessvito pay the remaining amount is apparent. ILR

AA2003-.fi’ar. 3533 [ T.Mohan Vs. Kannammal 82. Another)

‘has been cited to contend that when the vendee is in

épossession of the property. the question of readiness and

willingness to pay the balance money does not assume much

/if

fi,{1l7_

importance. ILR 1998 Kar. 2730 (N.Venkatappa Vs.
Lingappa Reddy by his L.Rs) has been cited tofc”ontend

that when the plaintiff is put in possession of~«~th¢V:p_I’ope1’ty

which is the subject matter of an agreementfandifdefendant ‘

also delivered some d0cume:nts,b”i3ut._ sta1lec1u._pVt’u’rther ”

proceedings and the plaintiff vl1as«._com.p1’_ied”

requirements under the contract, fI€_V to a
Judgment and Decree” of spec’i’iiclV[oerf’orinanceI ILR 1988
Kar. 1340 m.n.Na;~¢amnai Vs. Madhava

Tenkillaya), ‘-hasi-beer); if readiness and

willintgnes’sA.. estfVab1i’s’hed, itfis not proper to non~suit a
persovnpon vVerbalV”ommis*si’on. The afore said decisions are
applicable’rt.o”the[factsof the present case. keeping in mind

tlie9e\(i.de:1Ce onflrecord.

1h’l’ii1_.i:” 2007 Kar. 1625 (P.S.Ramakrishna Reddy

Vs; M:I$’.I?hagyalakshmi 82, Another) it has been held that

th’e._re1ief of specific performance cannot be denied on the

fgground that the price of immovable property has risen. In

AIR 2008 so 1205 [Balasaheb Dayandeo Naik (Dead) by

L.Rs 82, Others Vs. Appasaheb Dattatreya Pawar} it is

stated that where agreement though specified time for

if}

_48u

execution of sale deed and where stipulation for forfeiture of
earnest money in the event of failure to execute sale deed
was also made, then it would indicate that time wouldnever

intended by parties to be of essence of the In

(1998) 2 SCC 488 {Smt.Indira Kaur

Lal Kapoor), in the context of the ‘4

plaintiff when the deferidai:-1;_ or th-edcourt endquireqp

about the name of the banl§’V”io:r’calledVuponif-thegiplaintiff to
produce the pass book’ wasddheldiéptha-tpno adverse inference

can be drawn against the plaintiff had

depogsvedlfvtliadtl hedfxhad requisite amount in the
bank,–~the pass book in respect of the
bank account. VV’I:heA’adfoi’esaid propositions are applicable to

of the xcas–e–.« ”

.’53”.’A (Civil) 308 (Silvey 82. Others Vs. Arum

Vargltese 82. another) deals with the case when the

it Afdefepndants failed to furnish the documents to the plaintiffs,

the conduct of the defendant cannot be ignored while

‘Hweighing the question of exercise of discretion for decreeing a

decree for specific performance. This decision is applicable

,4’

AN

Wfiigw

to the facts of the case as the defendant failed to obtain

income Tax clearance in the instant case.

54. Though we have answered all the points for

consideration in favour of the respondent. considering. the

long lapse of time involved in litigation and

estate that have arisen in the inte’rregnu.rn,_v’are of the

View that the respondent, while ha!.ar1ce«.p”a§Inei1tV

of Rs.2,40,000/– to the appellant,» should arrested to pay’?

interest at 24% pa Q11 its-u_m from the date of

agreement till the datelofhis’ direction, we feel

would V if

55. ‘:.E’or the aforesaidctgpreasons, the appeal filed by the

defendant the judgment and decree passed

by._§thei’.trial is confirmed Jsubject to above direction.

. Parties to -bear their own costs.

Sd/*
IUDGE

sd%
IUDGE

KVN*