IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 06.11.2009
CORAM
THE HONOURABLE MR. JUSTICE P.R.SHIVAKUMAR
A.S.No.1039 of 1996
&
C.M.P.No.3538 of 2007
K.Sunthanthiram ... Appellant
-Vs-
V.Murugesan ...Respondent
Appeal is filed under Section 96 of Civil Procedure Code against the judgment and decree dated 8.8.1996 made in O.S.No.907 of 1993 on the file of the Additional Subordinate Judge of Erode.
For Appellant : Mr.S.Parthasarathy
Senior Counsel
for Ms.P.Bagyalakshmi
For Respondent : Mr.V.K.Muthusamy
Senior Counsel
for Mr.Bharathidasan
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JUDGMENT
The plaintiff in the original suit is the appellant herein. The suit was filed by him on the basis of an agreement for sale dated 15.09.1988, to which the appellant and the defendant were the parties, for the relief of specific performance in the said contract. The learned trial Judge after trial, dismissed the suit holding the appellant/plaintiff not entitled to the relief of specific performance, by judgement and decree dated 08.08.1996. Aggrieved by the same and challenging the decree of the trial court dismissing the suit filed by the appellant herein, the present appeal has been preferred on various grounds set out in the memorandum of appeal.
2.The appellant had filed the suit before the trial court containing the following allegations.
The suit property originally belonged to the respondent / defendant, who got it under a partition deed dated 19.02.1986 bearing Document No.880 of 1986. He offered to sell the suit property measuring an extent of 2.08 acres to the appellant/plaintiff at the rate of 2,75,000/- per acre and the said offer was accepted by the appellant/plaintiff, pursuant to which both of them entered into a written agreement for sale dated 15.09.1998. On the date of the agreement itself, the appellant / plaintiff paid a sum of Rs.1,00,000/- as advance and part of the consideration. Though the agreement contains a recital that the transaction should be completed within a period of one year, the same was not the essence of the contract. In accordance with the said agreement for sale, four sale deeds covering an extent of 8,626 Sq.ft alone were executed by the respondent / defendant. Sale deed in respect of the balance extent remained to be executed. The appellant/plaintiff was ready and willing to perform his part of the contract and he had made his readiness and willingness to make payment of the balance consideration and get the sale deeds executed by the respondent /defendant, provided he could get encumbrance certificate and Income Tax clearance certificate known to the respondent/defendant. Despite repeated request made by the appellant / plaintiff, the respondent/defendant did not get Income Tax clearance certificate. On the other hand, the respondent / defendant chose to issue a telegram at the fag end of the period stipulated in the agreement, calling upon the appellant/plaintiff to make payment of the sale consideration and get the sale deed executed, as if he was ready to perform his part of the contract. The respondent / defendant also issued a lawyer’s notice to that effect. A suitable reply was sent by the appellant / plaintiff, asking the respondent / defendant to get the Income Tax clearance certificate. Possession of the property, which was the subject matter of the agreement, was handed over to the appellant / plaintiff on the date of agreement itself, to enable him to form a lay out dividing the property into house sites and in fact, the appellant / plaintiff divided the properties into several house sites, out of which four plots alone were sold. While so, the respondent/defendant, who was not ready and willing to perform his part of the contract, made attempts to alienate and encumber the suit property in order to defeat the right of the appellant / plaintiff and also attempted to deposes the plaintiff/appellant, by driving him out of the suit property. Therefore, the appellant / plaintiff had to approach the Court by way of the suit for the relief of specific performance of contract directing the respondent / defendant to execute sale deed in respect of the suit ‘B’ Schedule property, after receiving the balance sale consideration and for permanent injunction restraining the respondent / defendant from interfering with the appellant’s / plaintiff’s peaceful possession and enjoyment of the suit property.
3.The suit was resisted by the respondent/defendant by filing a written statement, admitting the execution of agreement for sale dated 15.09.1988 and the receipt of a sum of Rs.1,00,000/- as advance and part consideration and denying the plaint allegations regarding the plaintiff’s / appellant’s readiness and willingness to perform his part of the obligations under the agreement. The further contentions raised in the written statement are as follows:-
It was specifically agreed by the parties to the agreement that the time stipulated in the agreement was the essence of the contract. The plaint allegations regarding induction of appellant / plaintiff in possession of the suit property in part performance of the contract is false. The appellant / plaintiff did not take any step to convert the property into house sites and hence there was no occasion for him to enter the property. The suit property continues to be an agricultural land and crops are being raised periodically by the respondent / defendant. It was the respondent / defendant, who was ever willing and ready to perform his part of the contract and on the other hand, the appellant / plaintiff was not ready and willing to perform his part of the contract as he could not arrange funds for the payment of the balance consideration. The plaint allegation that the sale could not take place, since the respondent / defendant had not obtained Income Tax clearance certificate is an utter false statement. The respondent / defendant who waited in vein till the end of the contract period, issued a telegram calling upon the appellant / plaintiff to come on 15.09.1989 with the balance sale consideration to take the sale deed from the respondent / defendant as per the agreement. After issuing such a telegram, the defendant in fact went to the Sub-registrar’s office at Surampatti and waited there from morning till evening, but the appellant/plaintiff did not turn up. Therefore, the respondent/defendant issued a layer’s notice fixing a dead line for payment of the balance consideration and to take the sale deed as per the agreement and thus making time for performance as the essence of the contract. The appellant/plaintiff, who received the said notice did not even respond. Thereafter, the appellant/plaintiff waited for three long years and filed the suit on 09.09.1992 affixing a Court fee of Rs.500/- alone, got the plaint returned on 14.09.1992, kept it in cold storage for more than 3 months and re-presented it on 04.01.1993, again with deficit Court fee, got it returned on 07.01.1993 and re-presented the same on 17.12.1993 with a delay of nearly one year. The said fact itself will show that the appellant/plaintiff did not have the necessary funds to pay the balance amount of sale consideration with a corollary that he was not ready and willing to perform his part of the contract from the date of agreement till the date of filing of the suit. Therefore, the appellant/plaintiff should be non-suited for the relief of specific performance sought for in the plaint.
4.Based on the above said proceedings, the trial Court framed the following issues and additional issues:
Issues:
1.Whether the plaintiff is entitled to the relief of specific performance as prayed for?
2.Whether the plaintiff was ready and willing to perform his part of the contract?
3.Whether the suit is barred by limitation?
4.To what relief?
Additional Issue:
1.Whether the plaintiff is entitled to permanent injunction as prayed
for?
5.PW1(the plaintiff) was the sole witness examined on the side of the plaintiff and Exs.A1 to A5 were the documents produced on his side. Similarly, DW1(defendant) was the sole witness examined on the side of the defendant and Exs.B1 to B17 were the documents marked on the side of the defendant. The report and plan of the Advocate Commissioner appointed by the trial court to make a spot inspection of the suit property, have been marked as Exs.C1 and C2.
6.On an appreciation of evidence adduced on both sides in the light of the arguments advanced on either side, the learned trial Judge came to the conclusion that the plaintiff was not ready and willing to perform his part of the contract under the suit agreement and hence he was not entitled to the relief of specific performance of the contract as prayed for in the plaint and thus decided the issue Nos.1 and 2 against the plaintiff and in favour of the defendant. So far as the issue No.3 is concerned, the Court below came to the conclusion that since the suit was filed within 3 years after the expiry of the period of one year stipulated in the agreement, the same was not barred by limitation. The additional issue No.1 was decided against the plaintiff holding that the plaintiff was not in possession of the suit property and hence he was not entitled to the relief of permanent injunction. Ultimately, the learned trial Judge, under issue No.4 came to the conclusion that the plaintiff was not entitled to any relief and accordingly dismissed the suit with cost by the judgment of the Court below dated 08.08.1996. The correctness of the said judgment and decree of the trial Court dated 08.08.1996 is questioned in this appeal by the appellant/plaintiff.
7.The suit being one for specific performance of contract under an agreement for sale of an immovable property, the appellant/plaintiff had not chosen to seek an alternative relief of refund of the advance amount with or without interest, in the event of the rejection of his plea for specific performance of the contract directing the respondent/defendant to execute the sale deed in terms of the agreement for sale. However, the appellant/plaintiff has chosen to file C.M.P.No.3538 of 2007 seeking permission of the Court, to amend the plaint so as to direct the defendant to refund the advance amount with interest, in the event of rejection of his prayer for specific performance. The said petition has been resisted by the respondent / defendant on the ground of belatedness. It has also been resisted on the ground that the prayer for refund of the advance amount is barred by limitation. It has also been contended that the appellant/plaintiff has waived and abandoned the relief, prayer for which is sought to be incorporated in the plaint by way of amendment.
8.The points that arise for consideration in the appeal and the C.M.P are:
1.Whether the appellant/plaintiff has pleaded and proved that he was always ready and willing to perform his part of contract under the suit agreement for sale marked as Ex.A1?
2.Whether the appellant/plaintiff is entitled to the relief of specific performance as prayed for by him in the plaint?
3.Whether the appellant/plaintiff is entitled to the relief of permanent injunction?
4.Whether the appellant/plaintiff shall be permitted to amend the plaint to include the prayer for refund of advance amount with interest?
5.Whether the appellant/plaintiff is entitled to a decree directing the respondent / defendant to refund the advance amount with interest?
9.This Court heard the arguments advanced by Mr.Parthasarathy, learned senior counsel representing the counsel on record for the appellant and also Mr.V.K.Muthusamy, the learned senior counsel representing the counsel on record for the respondent. The materials records were also perused.
10.The unsuccessful plaintiff is the appellant herein. The suit was filed for specific performance and for permanent injunction based on an agreement for sale dated 15.09.1989. The said suit agreement has been produced on the side of the appellant/plaintiff and marked as Ex.A1. It is not in dispute that the parties to the suit entered into such agreement under the document marked as Ex.A1. The respondent / defendant admitted the execution of Ex.A1 agreement and receipt of a sum of Rs.1,00,000/- on the date of the agreement as advance and part consideration. On the other hand, the relief of specific performance sought by the appellant/plaintiff has been resisted by the respondent / defendant, on the ground that the appellant/plaintiff had not been ready and willing to perform his part of the contract, even though the respondent / defendant was ready and willing. Section 16(c) of the Specific Relief Act mandates that a plaintiff seeking the relief of specific performance shall specifically plead and prove that either he had performed his part of the obligations under the agreement or that he had been ready and willing to perform his part of the contract through out. But it should be kept in mind that the mere fact that the plaintiff has made such a plea and is able to prove the same, will not make it mandatory on the part of the Court to grant the relief of specific performance, as the relief of specific performance is a discretionary relief and the Court is having a discretion, of course a discretion guided by legal principles, either to grant or not to grant such a relief. Section 20 of the Specific Relief Act enumerates the circumstances and grounds on which the discretion not to grant such relief can be exercised. Keeping the said principle in mind, let us now approach the issues involved in this case.
11.No doubt the appellant/ plaintiff has made a specific plea in his plaint to the effect that he was always ready and willing to perform his part of the contract under the Ex.A1 agreement of sale and that on the other hand, it was the respondent / defendant who was not ready and willing to perform his part of the contract. The said plaint averment has been emphatically denied by the respondent / defendant, who has contended that there was readiness and willingness on the part of the respondent / defendant and it was the appellant / plaintiff who lacked in such readiness and willingness. In the light of the said rival pleadings, we have to consider the evidence to find out whose plea can be sustained.
12.It is the case of the appellant / plaintiff that though a period of one year had been stipulated in Ex.A1 agreement for the completion of transaction, the said time could not be construed to be an essential condition of the contract. It is his further contention that though the time stipulated was not the essence of the contract, right from the date of agreement till the filing of the suit, he was ready and willing to perform his part of the contract. As the said contention is not admitted and on the other hand stoutly denied by the defendant, it is the duty of the appellant / plaintiff to prove the correctness of the said plea made by him. The only witness examined on the side of the appellant / plaintiff in order to prove his readiness and willingness was appellant / plaintiff himself. No independent witness was examined on his side. Apart from producing Ex.A1 agreement for sale, the plaintiff has also produced certified copies of the four sale deeds executed by the respondent / plaintiff covering a total extent of 8626 Sq.ft in favour of the nominees of the appellant / plaintiff in pursuance of suit agreement for sale. They have been marked as Exs.A2 to A5. It is the further contention of the appellant / plaintiff that after execution of the originals of Exs.A2 A5, there arose a difficulty in getting further sale deed/deeds executed without the production of Income Tax clearance certificate; that hence he demanded production of Income Tax clearance certificate by the respondent / defendant and that despite several requests made by the appellant / plaintiff, the respondent / defendant failed to produce such Income Tax clearance certificate which resulted in the plaintiff’s inability to get further sale deeds executed. Even though the appellant / plaintiff was ready and willing to perform his part of the contract by making payment of the balance consideration and getting the sale deed executed in his name or in the name of his nominees, the appellant / plaintiff has contended, the non-production of Income Tax clearance certificate was an impediment for the completion of the sale transaction in accordance with Ex.A1 agreement. Except the ipsidixit of the plaintiff, who deposed as PW1, there is no other evidence either oral or documentary to prove that such a demand was made by him. Though the plaint contains an allegation that the appellant / plaintiff issued a reply to the lawyer’s notice sent by the respondent / defendant, calling upon the respondent / defendant to get and produce Income Tax clearance certificate, there is not even a piece of paper to show that such a reply notice was sent. The copy of the notice issued by the respondent / defendant on 19.09.1989 has been marked as Ex.B1: Ex.B2 is the postal acknowledgment card evidencing service of the said notice on the appellant/plaintiff.
13.The receipt of telegram and the lawyer’s notice issued by the respondent / defendant has been admitted by the appellant / plaintiff. At the same time, PW1 (plaintiff) in his evidence has not confirmed the plaint allegation to the effect that a reply notice was sent by him to the respondent / defendant calling upon him to produce Income Tax clearance certificate. On the other hand, there is a specific admission made by him to the effect that he did not issue any notice calling upon the respondent / defendant either to produce Income Tax clearance certificate or to execute sale deed. However, he had tried to introduce a new case in evidence, as if after receiving Ex.B1 notice, he met the respondent / defendant in person and demanded production of IT clearance certificate and execution of sale deed thereafter. It is highly improbable that the appellant/ plaintiff could have made such a demand. For getting an Income Tax clearance certificate, one should produce a draft sale deed along with the application for such certificate. The draft sale deed should have been prepared by the proposed purchaser. In Ex.B1 notice, the respondent / defendant had informed the appellant / plaintiff that the appellant / plaintiff was given a month’s time for completing the sale transaction and directed him to prepare and send a draft sale deed to the respondent / defendant. Admittedly, the appellant / plaintiff did not prepare and send any draft sale deed to the respondent / defendant as demanded in Ex.B1 notice. Therefore, it is obvious that the appellant / plaintiff kept quiet even though the respondent / defendant had called upon the appellant / plaintiff to prepare and send the sale deed for proceeding with the sale. The non-production of the draft sale deed by the appellant / plaintiff as demanded by the respondent / defendant will make it clear that the present plea taken by the appellant / plaintiff that he could not complete the sale transaction because the respondent / defendant was not able to get and produce Income Tax clearance certificate is only a lame excuse put forth as a result of an after thought. PW1 has admitted that at the time of execution of sale deeds under the originals of Exs.A1 to A4, production of Income Tax clearance certificate was not demanded and no difficulty was experienced in getting the said sale deeds registered and in getting back the registered documents from the Office of the Sub-Registrar. It was also admitted by the PW1 that he was informed at the time of registration of those sale deeds that no Income Tax clearance certificate was needed. Therefore, the present contention of the appellant / plaintiff that the non-production of Income Tax clearance certificate by the respondent / defendant was the reason for non-completion of the sale transaction cannot be sustained, as the said plea has been taken as an afterthought to explain why he was not ready to perform his part of the contract even after he was called upon by the respondent/defendant by issuing a telegram and a legal notice under Ex.B1.
14.Admittedly, the time for completion of transaction was fixed at one year as per the terms of the agreement Ex.A1. The agreement contains necessary recital to show that the parties intended that the transaction should be completed within a period of one year. It was recited therein that the appellant/plaintiff should make payment of the balance consideration and get the sale deed or sale deeds executed within the said period of one year, failing which the advance amount would be forfeited and his right to seek specific performance of the contract would be lost. It was also recited there in that in case the appellant/plaintiff was ready and the respondent/defendant was not ready, then the appellant/defendant could enforce the contract through Court and get the relief of specific performance, whereupon the respondent/defendant would be held liable for all the costs incurred by the appellant/plaintiff. Of course, these recitals are capable of suggesting that the parties intended that the transaction to be completed within a period of one year as stipulated in the agreement. But the same shall not be the conclusive proof of a consensus between the parties to make time for completion, the essence of the contract.
15.Admittedly, the agreement was entered into to enable the appellant/plaintiff to lay out the land into house sites and sell the house sites to the intending purchasers. Recitals are also found in Ex.A1 to the effect that possession of the land was handed over to the appellant/plaintiff to form a layout. When that is the case, we cannot come to the conclusion that the time for performance stipulated in the agreement was agreed to be the essence of the contract. If no time has been fixed in the agreement or if the time stipulated in the agreement has not been agreed to be essence of the contract, it does not mean that a party to the agreement cannot make it the essence of the contract, by stipulating a reasonable time for performance. In this regard, admittedly at the fag end of the period stipulated in the agreement, the respondent/defendant issued a telegram calling upon the appellant/plaintiff to come to the Sub-Registrar’s office on 15.09.1989 and get the sale deed executed after making payment of the balance sale consideration. As the appellant/plaintiff did not turn up, the respondent / defendant chose to issue a notice on 15.09.1989 calling upon the appellant/plaintiff to send the draft sale deed within a week and get the sale deed registered within a month from the date of receipt of the notice and informing him that in case of failure, the sale agreement dated 15.09.2009 would stand terminated. By issuing such a notice, the respondent/defendant had conveyed a clear message to the appellant/plaintiff that he wanted the time granted by him in the legal notice was to be treated as an essential condition of the contract. Therefore, it has to be concluded that though the time originally stipulated in Ex.A1 agreement was not intended to be the essence of the contract, the respondent/defendant by issuing Ex.B1 notice, the receipt of which has been acknowledged under Ex.B2, has made it abundantly clear that the time was the essence of the contract and that the failure to complete the transaction by the time stipulated in the notice would cause termination of the agreement. Therefore, the contention of the respondent/defendant that on that score alone, the relief sought by the appellant/plaintiff for specific performance of contract has got to be countenanced.
16.Even assuming that the issue of Ex.B1 notice would not have made time stipulated therein as the essence of contract, unless the appellant/plaintiff is able to prove that he was ready and willing to perform his part of the contract right from the date of agreement till the filing of the suit and even during the pendency of the suit, he shall not be entitled to the relief of specific performance. Similarly, even if the time was made the essence of contract by the issue of Ex.B1 notice, if the appellant/plaintiff is able to show that he was ready and willing to perform his part of the contract and it was the respondent/defendant who was not ready and willing, then he may be granted the relief of specific performance, despite the fact that he had not chosen to file the suit within the period stipulated in Ex.B1 notice. Time being the essence of contract, has nothing to do with the limitation for filing a suit. If a time is fixed in the agreement, then the period of limitation for filing the suit will start from the date of expiry of the said time. If no time is stipulated in the agreement, then the period of limitation will start from the date of refusal on the part of the other party to perform. Therefore, the question whether the time stipulated in the agreement is the essence of the contract or not, is immaterial so far as the question of limitation is concerned. On the other hand, the question whether the time stipulated in the agreement is the essence of the contract, does have a bearing on the question of exercise of discretion for granting the relief of specific performance of contract. If it is proved that the parties agreed that the time should be the essence of the contract, then unless the party filing the suit for specific performance is able to show that he was not only ready and willing to perform his part of the contract within the said time but also made all efforts to complete the transaction within the time and that he approached the Court for such a relief of specific performance without avoidable delay, he shall not be entitled to the relief of specific performance. In this case as pointed out supra, except a bald allegation in the plaint that he was ready and willing to perform his part of the obligation under the agreement and on the other hand the respondent/defendant was not ready and willing, the appellant/plaintiff has not let in any other evidence to prove the same. Apart from the absence of evidence, there is no independent witness or documentary evidence to prove his readiness or willingness to perform his part of the obligation under the agreement. The appellant/plaintiff as PW1 has clearly admitted that the telegram issued by the respondent/defendant was not responded by him and that even after the receipt of Ex.B1 notice, he did not come forward with any reply expressing his readiness and willingness to pay the balance consideration and get the sale deed executed within the time stipulated therein. He has also admitted that he did not prepare and send the draft sale deed as demanded by the respondent/defendant in Ex.B1 notice. It is also admitted by him that he did not issue any reply notice. From the same, it is quite clear that appellant/plaintiff was not ready and willing to perform his part of the obligations under the suit agreement, even after the receipt of the notice issued by the respondent under the original of Ex.B1.
17.On the other hand, the respondent/defendant has not only made clear averment in his written statement that it was the appellant/plaintiff who was not ready and willing to perform his part of the contract even though the respondent / defendant was always ready and willing till the expiry of the time stipulated in Ex.B1 notice, but also has deposed as PW1 in clear terms to the effect that the appellant/plaintiff could not arrange funds for the purchase of the property. The contention of the respondent/defendant gains strength from the effect that after the expiry of the period stipulated in Ex.B1 notice, the respondent/defendant issued a notice on 25.10.1989, a copy of which has been marked as Ex.B3, informing the appellant/plaintiff that the agreement stood terminated by the issue of the said notice as he did not come forward to complete the transaction in spite of repeated demands made by the respondent/defendant in person and by issuing the ultimatum under Ex.B1 notice. The said notice was received by the appellant/plaintiff as evidenced by the postal acknowledgment card marked as Ex.B4. The preponderance of evidence adduced on either side will show that it was the plaintiff, who was not possessed of sufficient money for purchasing the property in terms of Ex.A1 agreement and that there was failure on his part to prove his readiness and willingness to perform his part of the obligations under the agreement.
18.In Embar Naidu Vs. Rathnam Chettair and another reported in 2003 (2) CTC 385, a Division Bench of this Court while interpreting Section 16(C) of the Specific Relief Act quoted a judgment of the Hon’ble Supreme Court in which it was observed that the conduct of the plaintiff prior and subsequent to the filing of the suit along with other attending circumstances should be taken into consideration to decide the question of his readiness and willingness to perform his part of the contract. In N.P.Thirugnanam V. R.Jagan Mohan Rao reported in AIR 1996 S.C.116, the Hon’ble Supreme Court made the following observations:
“It is not necessary for the plaintiff that he should keep ready the money on hand. What is relevant and material is that he should have the necessary capacity to raise the funds and was ready and willing to perform his part of the contract. Section 16(c) of the Act envisages that plaintiff must plead and prove that he had performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than those terms 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 continuos 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.”
19.In Swasmi Ganesh Dassji V.Sita Ram Thapar reported in AIR 1996 S.C. 2095, wherein the Supreme Court held as under:-
“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.”
20.If the ratio decided in the above said cases is applied to the facts of the case on hand, one can arrive at a conclusion that the conduct of the appellant/plaintiff, not only prior to the filing of the suit, but also from the date of original presentation of the plaint will make it clear that he was not possessed of and he was not having the capacity to arrange for the funds, to make payment of the balance consideration under the suit agreement. As pointed out supra, he did not take effective steps to pay the balance consideration under Ex.A1 agreement and get the sale deed executed within a period of one year stipulated in the agreement. Therefore, the respondent/defendant was constrained to issue a telegram calling upon the appellant/plaintiff to make payment of the balance sale consideration at the Sub Registrar’s Office and get the sale deed executed on 15.09.1989. In fact, after issuing the telegram, the respondent/defendant went to the Sub-Registrar’s Office, which is evidenced by the fact that he attested three documents registered in the Sub Registar’s Office concerned on the said date. The appellant / plaintiff has also admitted the receipt of the telegram. He has also admitted that he did not go to the Sub Registrar’s Office. Having waited in vein, from morning till evening on 15.09.1989 in the office of the Sub Registrar, the respondent / defendant chose to issue a notice under Ex.B1 on 15.09.1989 calling upon the appellant/plaintiff to get the sale deed executed within one month from the date of receipt of the said notice. Even thereafter, the appellant/plaintiff did not make arrangements for the payment of the balance consideration and to get the sale deed executed in his favour. He has not even issued a reply to the said notice. The plaint averment to the fact that a reply notice calling upon the respondent/defendant to produce Income Tax clearance certificate is proved to be false by the admission of PW1 in his evidence during cross examination. Therefore, it is quite obvious that till the expiry of one month period from the date of receipt of Ex.B3 notice, the appellant/plaintiff simply kept quiet without doing anything towards the completion of the transaction to show his readiness and willingness to perform his part of the obligations under Ex.A1 agreement and that the same resulted in the issue of Ex.B3 notice informing the appellant/plaintiff that the agreement would stood terminated by the receipt of said notice. The receipt of Ex.B3 is also admitted. Even thereafter, the appellant/plaintiff did not act quickly. No reply to the said notice refuting the contents of the said notice was issued. On the other hand, the appellant/plaintiff waited till the fag end of the period of limitation, namely 3 years and chose to file the suit deliberately with insufficient stamp (Rs.500/- against Rs.30,256/-). The plaint was originally presented with such defect on 09.09.1992. The same was returned for the above said defect and it was properly re-presented with necessary Court fee only on 17.12.1993. He had taken more than a year for payment of Court fee. The same will also show that the appellant/plaintiff was not in possession of sufficient means even for the payment of the Court fee. As a necessary corollary, it has to be held that the plaintiff was not having necessary funds for the payment of balance sale consideration even on the date of filing of the suit. It is worth mentioning that the appellant/plaintiff has not chosen to volunteer to deposit the balance sale consideration to the credit of the suit when the suit was filed.
21.All these factors will show that the appellant/plaintiff has miserably failed to prove his readiness and willingness to perform his part of the contract from the date of agreement till the date of filing of the suit and thereafter till the date of decree. The Court below has marshaled the evidence properly and came to the correct conclusion that the appellant/plaintiff failed to prove his readiness and willingness to prove his part of the obligations and on that score that alone, he should be non-suited for the relief of specific performance.
22.Yet another aspect to support the above said conclusion is that even assuming that the time for performance is not the essence of the contract as the agreement is for the conveyance of an immovable property, the plaintiff shall not be entitled to the discretionary relief of specific performance, as he has not chosen to file the suit within a reasonable time. A total inaction on the part of the plaintiff for about 2 = years was held by the Hon’ble Supreme Court in K.S.Vidyanadam and Others Vs. Vairavan reported in 1997 3 SCC, page 1 to be sufficient for the exercise of the discretion of the Court for grant of specific performance of agreement against the plaintiff. In Ranganatha Gounder and Sahadeva Gounder and others reported in 2004 (4) CTC 375, a Division Bench of this Court has held that the though the time was not the essence of the contract, the Court might infer that it was to be performed within a reasonable time and that the plaintiff seeking the relief of specific performance should have approached the Court within a reasonable time. In P.C.Martin V. Jambagalakshmi Krishnan reported in 1995-1-L.W.97, a Division Bench of this Court held that the inordinate delay in fulfilling his part of the contract by the plaintiff would disentitle him from getting the discretionary relief of specific performance. In Pushparani S.Sundaram and Others Vs. Pauline Manomani James (Deceased) and others reported in (2002) 9 Supreme Court Cases 582, Hon’ble Supreme Court has held that the readiness and willingness to perform the essential terms of the contract might be inferred from totality of circumstances or conduct of the plaintiff and that mere filing of the suit, without further proof as to readiness and willingness shall not be enough.
23.This Court being the final Court of appeal on facts, on a thorough re-appreciation of evidence and on application of the above said principles declared in the precedents cited supra, comes to the conclusion that there is no defect, error or infirmity in the finding of the trial court that the appellant/plaintiff was not able to prove his readiness or willingness to perform his part of the obligations under Ex.A1 agreement and that hence, he was not entitled to the relief of specific performance. For all the reasons stated above, the said finding of the trial Court deserves no interference and on that other hand, deserves to be confirmed. Point No.1 and 2 are answered accordingly.
24.The appellant/plaintiff has also prayed for a decree of permanent injunction restraining the respondent/defendant from alienating or encumbering the suit property and also from interfering with the plaintiff’s alleged peaceful possession and enjoyment of the suit property. It is the case of the appellant/plaintiff that pursuant to the agreement, he was put in possession of the suit property for forming roads and laying out the property into house sites for sale to the intending purchasers. It is the contention of the plaintiff that pursuant to the agreement, he got possession of the property and divided it into 44 house sites, out of which he was able to sell only 4 house sites totally measuring 8,626 Sq.ft. Though, the respondent/defendant has taken a plea of defense that possession of the property was not handed over to the plaintiff as he did not take steps to lay out the property into house sites, while deposing as DW1, the defendant has admitted that possession of the property was delivered to the plaintiff pursuant to Ex.A1 agreement. Agreement also contains recital to the effect that possession was delivered to the appellant/plaintiff. Therefore, plaintiff’s claim that he got possession of the property, which was the subject matter of Ex.A1 agreement pursuant to the said agreement has got to be sustained. But the mere fact that possession was delivered on the date of agreement to the appellant/plaintiff will not be enough to prove that he continued to be in possession and was in possession as on the date of plaint. Unless the appellant/plaintiff is able to prove that he was in possession as on the date of plaint, he cannot succeed in getting a decree for permanent injunction not to disturb his possession. In this case, though the respondent/defendant admitted that the appellant/plaintiff got possession pursuant to the agreement, he has come forward with a further plea that pursuant to the cancellation of the agreement by issuing Ex.B3 notice, the respondent / defendant resumed possession and thereafter brought it under his cultivation. The said contention of the respondent/defendant is no doubt denied by the appellant/plaintiff. But there is no document to show that appellant/plaintiff was in possession of the suit property as on the date of plaint. On the other hand, the defendant has produced the Exs.B8 to B11 and documents showing that he availed agricultural loan from the Primary Agricultural Cooperation Bank. They are marked as Exs.B12 to B17. Apart from the same, the Advocate Commissioner appointed by the trial court visited the suit property and submitted a report along with a plan which have been marked as Exs.C1 and C2. The same will show that the land was used as an agricultural land and cultivation was being done. Though the Commissioner visited after giving notice to the counsel for both parties and the plaintiff and the counsel for the plaintiff were present at the time of the visit made by the Commissioner, the plaintiff(PW1) simply stated that he was not aware of the Commissioner’s visit. From Ex.C1-Commissioner’s report, it is clear that the plaintiff was very much present, when the property was inspected by the Commissioner. As the report of the Commissioner is against the plaintiff’s claim, the plaintiff has denied knowledge of the Commissioner’s visit, much against the contents of the Commissioner’s report. All the documents, including the Commissioner’s report and also the evidence of PW1 will show that the property was in possession of and under the cultivation of the respondent/defendant and that the same will probablise the case of the respondent/defendant that he resumed possession after terminating the agreement by issuing Ex.B3 notice. The preponderance of evidence adduced on either side in this regard will improbablise the case of appellant/plaintiff that he was in possession as on the date of the suit and probalise the case of the respondent/defendant that he resumed possession after terminating the agreement by issuing notice under Ex.B3.
25.The Court below has rightly come to the conclusion that the possession was not proved to be with plaintiff and on the other hand, it was proved to be with the defendant and that hence, the plaintiff was not entitled to the relief of permanent injunction. As it has already been held in the forgoing paragraphs that the plaintiff has failed to prove his readiness and willingness to perform his part of the obligations under the agreement, the same will also be a ground for non-suiting the plaintiff to the relief of permanent injunction. This Court finds no defect or infirmity in the said finding of the trial court and the same does not deserve any interference. The said finding of the trial Court has got to be confirmed. The point No.3 is answered accordingly.
26.The learned counsel for the appellant has submitted that the trial court after coming to the conclusion that the plaintiff was not entitled to the relief of specific performance of the contract, ought to have given a chance to the plaintiff to amend the plaint by seeking the alternative relief of refund of advance amount and accordingly granted such relief; that the failure on the part of the trial court to do so will justify the interference by the appellate court as the relief of specific performance is discretionary and the prayer for the same can be rejected even if the plaintiff might be able to prove that he was ready and willing to perform his part of the obligations in accordance with the terms of contract and that in equity, the plaintiff would be entitled to a decree directing the defendant to refund the advance with or without interest depending on the circumstances of the case minus any damages for the loss sustained because of the non-fulfillment of obligations under the contract. But as per Section 22(2) of the Specific Relief Act, such relief cannot be granted unless such a prayer is made by the plaintiff in the plaint. It has been interpreted in a number of decisions that the mere failure on the part of the plaintiff seeking specific performance to make an alternative prayer for the refund of the advance amount shall not justify the dismissal of the suit without affording an opportunity to the plaintiff to include such a prayer by amending in the plaint. It has also been held that when the Court comes to the conclusion that the plaintiff would not be entitled to the relief of specific performance, it should have given an opportunity to the plaintiff to seek refund of the advance by amending the plaint. In this case, on verification of record, it is found that no such opportunity was given to the appellant/plaintiff. Therefore, the appellant/plaintiff has come forward with C.M.P.No.3538 for amending the plaint to incorporate a prayer for the alternative relief of refund of advance amount with interest. In the light of the above said judgments, it becomes imperative to allow the appellant/plaintiff to amend the plaint to include a prayer for the alternative relief of refund of advance amount. As the suit for the main relief of specific performance has been filed within the period of limitation, the inclusion of the prayer for alternative relief subsequently will not attract the bar of limitation since the grant of alternative relief depends upon the rejection of the plea for specific performance. Therefore, the civil miscellaneous petition has got to be allowed and the appellant/plaintiff shall be permitted to amend the plaint to incorporate a prayer for the alternative relief of refund of advance amount with interest. Point No.4 is answered accordingly.
27.In the light of the permission granted for amending the plaint to incorporate a prayer for alternative relief of refund of advance amount, the said question has to be decided to render complete justice in this case. Admittedly, the plaintiff paid a sum of RS.1,00,000/- as advance and part consideration on the date of Ex.A1 agreement. It was contended by the appellant/plaintiff that he paid another sum of Rs.69,000/- at the time of execution of sale deeds under Ex.A2 to A5. However, the respondent/defendant has contended that for the four sale deeds under Ex.A2 to A5, the appellant/plaintiff himself received the consideration from the purchasers. On the other hand, the appellant/plaintiff would contend that the sale deeds were executed by the respondent/defendant in favour of the purchasers under the said sale deeds and the appellant/plaintiff being the agreement holder, simply attested the said documents. There is no clear cut evidence as to how the amount was adjusted. According to the appellant/plaintiff, the total amount paid to the respondent/defendant as advance under Ex.A1 and as sale consideration under Ex.A2 to A5 was Rs.1,69,000/-. This was reflected in the testimony of PW1. But there is no clear cut pleading in the plaint as to how much was paid to the respondent/defendant under each one of the sale deeds Ex.A2 to A5. The sale consideration quoted in Ex.A2 to A5 are as follows:-
Exhibit A2 – Rs.4,295/-
Exhibit A3 – Rs.5,000/-
Exhibit A4 – Rs.5,558/-
Exhibit A5 – Rs.2,100/-
————
Rs.16953/-
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28.The total amount reflected in the sale deeds Exs.A2 to A5 comes to Rs.16,953/- alone. This Court wonders how the plaintiff has claimed that a total sum of Rs.1,69,000 including the advance of Rs.1,00,000/- was paid to the respondent/defendant. There is no record to show that any amount was paid to the respondent/defendant when the sale deeds under the originals of Exs.A2 to A5 were executed. On the other hand, there is an admission in the evidence of PW1 that it was the plaintiff who sold the property under the originals of Exs.A2 to A5 to the purchasers therein. Total extent conveyed under Exs. A2 to A5 sale deeds comes to 8,626 Sq.ft which is equivalent to 20 cents. The rate fixed as per the suit agreement is Rs.2,75,000/- per acre, i.e., equal to Rs.2750/cent. For 20 cents, the rate will come to Rs.55,000/-. When the proportionate amount payable to the respondent/defendant for the sales under Ex.A2 to A5 comes to Rs.55,000/- alone, it is highly improbable for the appellant/plaintiff to have paid Rs.69,000, that too without getting any acknowledgment in writing or getting an endorsement made on the agreement for sale. Therefore, this Court has to accept the contention of the respondent/defendant that no amount, over and above the advance amount of Rs.1,00,000/- on the date of agreement, was paid by the appellant/plaintiff to the respondent/plaintiff. Therefore, this Court comes to the conclusion that the claim of the appellant /plaintiff that a sum of Rs.69,000/- was paid over and above a sum of Rs.1,00,000/- paid on the date of agreement, has not been substantiated by proper evidence and hence the said contention of the appellant/plaintiff deserves to be rejected. This Court hereby comes to the conclusion that only a sum of Rs.1,00,000/- had been paid by the appellant/plaintiff to the respondent/defendant for the transaction under the suit agreement for sale. As the plaintiff is held not entitled to the relief of specific performance of contract directing the respondent/defendant to execute the sale deed in terms of the agreement, the appellant/plaintiff shall be entitled to claim refund of the amount paid by him under the agreement to the respondent/defendant except to the extent of loss proved to have been sustained by the respondent/defendant because of the plaintiff’s failure to complete the contract. In this case, there is no proof that the defendant sustained any loss because of the non-completion of the transaction. In addition to that it was also argued on behalf of the respondent/defendant that the appellant/plaintiff would not be entitled to the relief of specific performance, because the value of the property had increased enormously from the date of agreement till the date of filing of the suit. Under such circumstances, this Court has to held that the respondent /defendant had not suffered any monetary loss due to the non-completion of the transaction under the suit agreement for sale. In addition to that, there is no evidence adduced on the side of the respondent/defendant to show that he sustained any loss because of the breach of contract. Hence, this Court comes to the conclusion that the respondent/defendant has not proved his entitlement to deduct any amount from the advance amount as damages.
29.The next question to be considered is whether the appellant/plaintiff shall be entitled to the refund of the entire amount paid by him as advance. The answer shall be in the negative because a portion of the property has been sold to the nominees of the appellant/plaintiff and the consideration for the same was received and appropriated by the appellant/plaintiff. The extent conveyed as per the agreement to the nominees of the appellant/plaintiff is 20 cents. So, proportionate amount as per the agreement referable to the said portion conveyed to the nominees of appellant/plaintiff shall have to be adjusted and deducted from the advance amount and the appellant/plaintiff shall be entitled to the refund of the balance amount alone. The proportionate consideration for 20 cents conveyed under originals Ex.A2 to A5, as per the agreement comes to Rs.55,000/-. Therefore, the plaintiff shall be entitled to claim refund of Rs.45,000/- only (Rs.1,00,000/- – Rs.45,000/- = Rs.55,000/-) only. The appellant/plaintiff shall not be entitled to interest upto the date of decree, since the prayer for the alternative relief of refund of advance amount has been made only in the appeal by filing a petition for the amendment of the plaint. The appellant/plaintiff shall also be held not entitled to claim interest as he was not found to be ready and willing to perform his part of the contract. This Court is of the considered view that the appellant/plaintiff shall not be entitled to any interest on the above said amount till the date of decree. However, it shall be in the interest of justice to award interest at the rate of 6% per annum from the date of decree till realization. Point No.5 is answered accordingly.
30.In the result, this appeal is allowed in part. The dismissal of the suit in respect of the prayers for the relief of specific performance of contract and for the relief of permanent injunction is confirmed and C.M.P No.3528 of 2009 is allowed. The suit is decreed in part in respect of the prayer for the alternative relief of refund of the advance amount by directing the respondent/defendant to pay the appellant/plaintiff a sum of Rs.45,000/- with future interest for the said amount from the date of the decree passed by this Court (Appellate Court) till repayment at the rate of 6% per annum. The parties are directed to bear their respective costs in both the Courts. The decree shall be drafted after the amendment is carried out.
gpa
To
The Additional Subordinate Judge,
Erode