IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 9.8.2006
CORAM:
THE HONOURABLE MR.JUSTICE C.NAGAPPAN
A.S.No.672 of 1993
Valliyathal .. Appellant
-Vs-
1.Dr.Noel Doss
2.Basheer Mohammed
3.Nahi Munnisa .. Respondents
Appeal against the judgment and decree dated 30.4.1993 made in
O.S.No.252 of 1989 on the file of Sub Judge, Tiruppur.
For appellant : Mr.V.K.Muthusami,
Senior Counsel for Mr.V.Bharathidasan
For respondents : Mr.S.Raghavan
for R2 and R3.
JUDGMENT
This appeal is preferred against the judgment and decree, dated 30.4
.1993, made in O.S.No.252 of 1989 on the file of Sub Judge, Tiruppur. The
plaintiff is the appellant.
2. The case of the plaintiff is that the first defendant executed an
agreement of sale with her on 12.9.1985 agreeing to sell the suit properties
for a sum of Rs.60,000/- and received an advance of Rs.10,00 0/- from the
plaintiff on the same day and it was also agreed that the plaintiff has to pay
the balance sale consideration of Rs.50,000/- on or before 11.12.1985 and get
the sale deed executed. It is further stated in the plaint that after
executing the agreement, the first defendant was evading the execution of sale
deed inspite of repeated requests by the plaintiff and the plaintiff is always
and ready and willing to perform her part of the agreement by offering the
balance sale consideration, but still, the first defendant was postponing the
execution under some pretext or other and later on the plaintiff came to know
that the first defendant executed the sale deed in favour of the third
defendant conveying the properties including the suit properties and the
alleged transaction will not affect the agreement of sale between the
plaintiff and the first defendant and the first defendant is bound to execute
the sale deed to the plaintiff as per the agreement and the third defendant
has purchased the suit properties after knowing about the existence of the
agreement and the sale deed is not binding on the plaintiff and the first
defendant and third defendant are bound to execute the sale deed in favour of
the plaintiff and to deliver possession of the suit properties.
It is further stated by the plaintiff that though three months time
has been fixed in the agreement, the time was not the essence of the contract
and the first defendant alone is responsible for the delay in completing the
transaction and the plaintiff has sought for a direction to the defendants 1
and 3 to execute the sale deed of the suit properties in favour of the
plaintiff after receiving the balance sale consideration and to deliver
possession and in the event of their failure, the sale deed to be executed by
the Court.
3. The first defendant in his written statement as well as in the
additional written statement has admitted that the plaintiff has entered into
a contract with him on 12.9.1985 to purchase the suit properties for a sale
consideration of Rs.60,000/- and paid a sum of Rs.10,000/- as advance and the
balance sale consideration of Rs.50,000/- has to be paid on or before
12.12.1985 and as per the terms of the agreement, the time is the essence of
the contract and the first defendant on several occasions, expressed his
intention to dispose of all his immovable properties at Tiruppur since he
wanted to shift his family to Coimbatore and that is the reason for fixing the
time limit for completion of the sale and the plaintiff was never ready at any
time to execute the sale agreement and did not take any step to extend the
time stipulated in the agreement and the first defendant in person and through
letters, requested the plaintiff and her husband to pay the balance sale
consideration and get the sale deed executed and inspite of it, they were not
ready and willing. It is further stated by the first defendant that the
plaintiff knew about the sale of the suit properties to the third defendant
and the plaintiff alone committed breach of contract and she is not entitled
to the relief of specific performance.
4. The second defendant in his written statement has stated that he
has nothing to do with the suit properties and he is an unnecessary party to
the suit.
5. The third defendant in her written statement has stated that she
purchased the suit properties for a valid sale consideration of Rs.2,40,000/-
from the first defendant under a registered sale deed dated 26.5.1986 and she
is a bonafide purchaser f alue and even if the sale agreement is true, the
plaintiff cannot specifically enforce the same since the time had expired and
the suit is liable to be dismissed.
6. The plaintiff in her reply statement has stated that the first
defendant himself has admitted that he waited for the contract to be completed
even after 11.12.1985 and hence the time is not the essence of contract to
both the parties and the agreement dated 12.9.1985 was never terminated by the
first defendant and the plaintiff was always ready and willing to perform her
part of the contract.
7. The Trial Court framed seven issues and the plaintiff examined
herself as P.W.1 and examined P.W.2 on her side and marked Exs.A1 to A4 and
the first defendant examined himself as D.W.1 and the third defendant examined
herself as D.W.2 and marked Exs.B1 to B24. On a consideration of oral and
documentary evidence, the Trial Court held that the time was the essence of
the contract as per the sale agreement and the plaintiff was not ready and
willing to complete the transaction as per the agreement and the third
defendant is the bonafide purchaser for value and the plaintiff is not
entitled for the discretionary relief of specific performance. Aggrieved over
the judgment and decree, the plaintiff has preferred the present appeal. In
this Judgment, for the sake of convenience, the parties are referred to as
arrayed in the suit.
8. The points for determination in this appeal are:-
“1.Whether time is the essence of the contract.
2.Whether the plaintiff was ready and willing to perform the
contract.”
POINT Nos.1 and 2:-
9. Mr.V.K.Muthusami, the learned Senior Counsel for the appellant
would urge that time is not the essence of the contract insofar as the sale of
immovable property is concerned. Per contra, Mr.S. Raghavan, the learned
counsel for the respondents 2 and 3 submits that having regard to the terms of
the contract, it is clear that there was an obligation to pay the balance of
sale consideration of Rs.50,000/- within three months from the date of the
agreement, more specifically commencing from 12.9.1985 on or before 11.12.1985
and failure to do so, would render the contract vitiated and the parties did
intend to make time the essence of the contract.
10. It is well settled principle that in the case of sale of
immovable property, time is never regarded as the essence of the contract. It
has to be ascertained whether under the terms of the contract, the parties
stipulated any specific time within which, it has to be completed and in
substance, it was intended that it should be completed within a reasonable
time. In other words, an intention to make time, the essence of the contract
must be expressed in an unequivocal language. Mere incorporation of a clause
in the agreement imposing penalty in case of default does not by itself
evidence an intention to make the time of the essence. The Court should look
at all the relevant circumstances including the time limit specified in the
agreement and determine whether its discretion to grant specific performance
should be exercised.
11. The Constitution Bench of the Apex Court in the case in CHAND
RANI v. KAMAL RANI ((1993) 1 SCC 519) has laid down the true principle that
even where time is not the essence of the contract, the plaintiff must perform
his part of the contract within a reasonable time and reasonable time should
be determined by looking at all surrounding circumstances including the
express terms of the contract and the nature of the property.
12. In the above legal background, we have to look at the terms of
the suit agreement. Ex.A1 is the Sale Agreement dated 12.9.1985 and the first
defendant has admitted that he executed it agreeing to sell the properties
belonging to him for Rs.60,000/- and received an advance of Rs.10,000/- on the
same day and the plaintiff has to pay the balance of sale consideration of
Rs.50,000/- within a period of three months viz., on or before 11.12.1985.
For better appreciation, the relevant portion of the Agreement is extracted
below:
“VERNACULAR TAMIL PORTION DELETED”
13. The case of the plaintiff as spoken by her as P.W.1 is that she was
always ready and willing to perform her part of the contract and on a number
of occasions, she approached the first defendant offering the balance of sale
consideration to complete the sale transaction as stipulated in the agreement,
but the first defendant was postponing the same under some pretext or other
and later she came to know that the first defendant has executed the sale deed
in favour of the third defendant conveying the properties.
14. The specific case of the first defendant is that prior to
agreement, he has expressed to the plaintiff his intention to dispose of all
his immovable properties at Tiruppur and to shift his family to Coimbatore and
that is why the time for execution of the sale deed was specifically mentioned
in the agreement and the plaintiff was never ready and did not take any step
to complete the transaction within the stipulated time and the first defendant
by letters demanded the execution of the agreement. The first defendant as
D.W.1 has adduced oral and documentary evidence in this regard.
15. Ex.B3 is the letter dated 7.12.1985 sent by the first defendant
to the plaintiff requesting her to complete the sale transaction as per the
agreement. Ex.B2 is its certificate of posting evidencing the despatch of the
letter. After the expiry of time stipulated in the agreement, i.e., after
11.12.1985, the first defendant sent Ex.B4 letter dated 20.12.1985 stating
that the plaintiff has not performed her part of the contract and allowed the
time to expire and hence the advance amount stood forfeited. Ex.B5 is the
certificate of posting evidencing the despatch of it to the plaintiff.
16. Except paying the advance amount of Rs.10,000/-, the plaintiff
did nothing to comply with the terms of the agreement, which require to pay
the balance and ask for execution of the sale deed within the time stipulated.
If really the case of plaintiff that she approached the first defendant
offering the balance of sale consideration and demanded the execution is true,
the same must have been reflected by a notice from her to the first defendant
and that was not done and no such notice was issued within the stipulated
time. Further, there was no reply to Exs.B3 and B4 letters sent by the first
defendant. The first defendant has sold the suit properties to the third
defendant by Ex.B18 Sale deed dated 28.5.1986 and thereafter, the plaintiff
has chosen to send Ex.A2 notice dated 24.9.1986 to the first defendant and the
suit was filed only on 1.9.1989.
17. The analysis of evidence shows that the first defendant was
heavily indebted and with the object of discharging the loans and shifting his
family to Coimbatore, he has stipulated the time in the sale agreement and the
intention to make time as the essence of the contract is evidenced from the
surrounding circumstances. It is the case of total inaction on the part of
the plaintiff and the Trial Court has rightly held that the plaintiff was
never ready and willing to perform her part of the contract and she is not
entitled to the relief of specific performance. The points are answered
accordingly.
18. There are no merits in the appeal and the same is dismissed. No
costs.
vks
To
1.The Subordinate Judge,
Tiruppur.
2.The Section Officer,
V.R.Section,
High Court, Madras.