Burdon of Proof in A Suit For Specific Performance

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burdonofproofinasuitforspecificperformance
burdonofproofinasuitforspecific
performance
Postedon29December2009byravidevaraj
Court
ChennaiHighCourt
Brief
I hold that in a suit for specific performance, it is for plaintiff to establish his/her readiness
and willingness from the date of agreement till the date of sale. In the instant case, the
plaintiff has not established that she was ready and willing to perform her part of the
contract.Theplaintiffhasalsonotestablishedthatshewasrunningahandicraftbusiness:she
hasnotevenstatedtheplaceofthebusinessandwhatwastheturnoverfromthebusiness.
Itisrelevanttonoticethatshehasnotexaminedanyoftheemployees,nordidsheproduce
anydocumenttoshowthatshewascarryingonthehandicraftbusiness.Exceptherevidence,
thereisnoindependentevidencetoshowthatherhusbandwasanincometaxassesseeand
the plaintiff has not produced any document to show that her husband was an incometax
assessee
Citation
Judgement
Bench:NBalasubramanian
PankajamParthasarathyAndFiveOthersvsKasturiGunaSinghon27/9/2000
ORDER
1.Thisappealisdirectedagainstthejudgmentanddecreedated26.7.1984inO.S.No.2066of
1961 on the file of the City Civil Court, Chennai. The suit is for specific performance. The
defendants in the suit are the first and the second appellants and the plaintiff in the suit is
the respondent. During the pendency of the appeal, the second appellant died and his legal
representativesareimpleadedasappellants3to6intheappeal.
2. The plaint averments are that the mother of the defendants, by name, late R.K.
Chengammal, was the owner of the house property bearing door no.28 (New No.47), Ganga
Nagar, Chennai24 (hereinafter referred to as "the suit property") and when the owner
expressedherintentiontosellthesuitproperty,theplaintiffagreedtopurchasethesame.In
pursuanceofthenegotiationsbetween
the parties, late R.K. Chengammal entered into an agreement of sale dated 26.1.1977 with
theplaintiffagreeingtosellthesuitpropertytotheplaintiffforaconsiderationofRs.51,000
(RupeesFiftyOneThousandonly),withoutany
encumbrance and the plaintiff has paid an advance amount of Rs.5,000 to late R.K.
Chengammal at the time of execution of the agreement of sale. The first defendant is the
attestingwitnesstotheagreement.Aspertheplaint
allegations, the terms of the agreement provide that the execution and registration of sale
deed should be completed within three months from the date of the agreement and R.K.
Chengammalshouldalsoproduceencumbrancecertificate
and other documents relating to the suit property to the plaintiff. It is stated that R.K.
http://www.lawyersclubindia.com/judiciary/burdonofproofinasuitforspecificperformance1209.asp
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Chengammal did not comply with the terms and postponed the registration. It is also stated
that a sum of Rs.20,000 was paid by the plaintiff to R.K. Chengammal on 23.1.1978 in the
presence of the defendants and the receipt of the same was also endorsed on the last page
oftheagreementofsaleandthedefendantshavesignedthereceiptaswitnessesalongwith
oneM.A.
Abbaswhoactedasamediator.Itisstatedthattheamountwaspaidontheassurancegiven
by R.K. Chengammal and the defendants that the sale would be completed within a short
time.
3. Further, it is stated that R.K. Chengammal died and after her death, the plaintiff has
demanded the defendants that the deed of sale should be executed in her favour informing
them that she was always ready and willing to pay the balance of sale consideration.
According to her, though the defendants promised several times to complete the sale deed,
theyfailedandneglectedtodoso.Itisstatedthatthefirstdefendantforherselfandasthe
PowerofAttorney
Agent of the second defendant sent a lawyers notice dated 28.12.1980 to the plaintiff
demandingpaymentofrentfromFebruary,1980onwardsandinformingtheplaintiffthatshe
hascommittedwilfuldefaultinpaymentofrentandshe
wasliabletobeevictedfromthesuitpropertyforwhichtheplaintiffsentareplyon7.1.1981
denyingtheallegationsanddemandingthedefendantsto
execute the sale deed as per the agreement of sale. In the notice, the plaintiff has also
stated that she would approach Civil Court if her request is not complied with. The plaintiff
thereafter filed the suit on 12.1.1981 alleging that the attitude and the conduct of the
defendants as well as R.K. Chengammal are unreasonable and unwarranted and the
defendantsaslegalheirsoflateR.K.
Chengammal,areboundtoexecutethedeedofsaleinfavouroftheplaintiff.Shehasstated
that she is always ready and willing to perform her pan of the agreement for sale and
accordingly,shefiledthesuitforspecificperformance.
4. The first defendant has filed a written statement stating that she is not disputing the
agreemententeredintobyhermotherwiththeplaintiffforthe
sale of the suit property. According to the first defendant, the sale should have been
completedwithinaperiodofthreemonthsfromthedateofthe
agreement and the plaintiff had no funds to complete the sale and therefore, she has been
evadingthetransaction.Thefirstdefendanthasstatedthatall
relevanttitledeedswerehandedovertotheplaintiff.Itisthecaseofthefirstdefendantthat
the plaintiff has been postponing the execution and registration of sale deed and it is not
correcttostatethatthemotherofthe
defendants was postponing the execution and registration of sale deed. The case of the first
defendant is that the plaintiff was not ready and willing to pay the balance of the sale
consideration and complete the sale. The first defendant has admitted the receipt of
Rs.20,000 by her mother in the year 1978. It is stated that the plaintiff did not perform her
partofthecontract,but
requested extension of time for the completion of the sale. The first defendant has stated
that that no assurance was given either by the mother Chengammal or by any of the
defendantsthataftertheadvanceamountisreceived,thesalewouldbecompletedwithina
shorttime.Itisstatedthattheplaintiffisatenantandafterthedeathofthefirstdefendants
motherin1979,thefirst
defendantandhermotherweredemandingtheplaintifftocompletethesaletransaction,but
theplaintiffwasevadingtocompletethesaletransaction,
requestingextensionoftimeforthecompletionofthesale.
5. It is the case of the first defendant that the claim of the plaintiff that she is ready and
willingtopaythebalanceamountandcompletethesaleisnot
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correct and the plaintiff has not even paid the rent regularly and when the first defendant
issuedanoticecallingupontheplaintifftopaytherent,the
plaintiffissuedareply.Thecaseofthefirstdefendantisthatthesaleagreementisnotvalid
and enforceable and the plaintiff had abandoned her rights under the agreement. It is also
statedthatthepreviousconductofthe
plaintiffcannotbecountenancedforgrantingthereliefofspecificperformanceastheplaintiff
wasnotreadyandwillingtoperformherpartofthecontract.
After referring to the exchange of notices between the parties, it is stated that the first
defendantwasreadytoexecutesaledeed,bothinhercapacityaslegalheirofChengammal
andaspowerofAttorneyAgentforthesecond
defendant. The case of the first defendant is that the plaintiff had abandoned her rights and
the plaintiff had no funds and she has sworn to a false affidavit filed along with the petition
seekingforextensionoftimefordepositofbalanceofsaleconsiderationandtheconductof
theplaintiffpriortothesuitaswellasaftersheapproachedtheCourtisaprooftoshowthat
she was not ready and willing to perform her part of the agreement. According to the first
defendant, the agreement cannot be enforced against her as well as against the second
defendant.
6. The trial Court, on the above pleadings, has framed as many as five issues for
considerationandthetrialCourt,afterconsideringtheevidence,oralanddocumentary,held
thatthesuitfilediswithinthelimeandthereisno
evidence of waiver or abandonment of right by the plaintiff. The trial Court also held that it
cannotbeheldthatbecauseofthedelay,theplaintiffisnot
entitledtothereliefofspecificperformance.ThetrialCourtcametotheconclusionthattime
isnottheessenceofthecontractandthesubsequentrise
in price cannot be taken as a reason for refusing the relief of specific performance of the
agreement.Insofarastheconductoftheplaintiffduring
the course of litigation is concerned, the trial Court held that the order passed by the trial
Court was with reference to the grant of temporary injunction and under the provisions of
Section28(1)oftheSpecificReliefAct,
theCourthasthepowertoextendtimeformakingdeposit.AccordingtothetrialCourt,the
Courthasthepowerinasuitforspecificperformancetoextendthetimefordepositandthe
failureofplaintifftodepositmoneyinthe
Court before the decree or even after the decree cannot be a reason to deny the relief of
specificperformance.ThetrialCourtalsoheldthatitwasthefirst
defendant who was not willing and ready to complete the sale. The trial Court held that the
plaintiffwasinapositiontopaythebalanceofsaleconsiderationandinsuchcircumstances,
thetrialCourtwasoftheviewthat
theplaintiffwasreadyandwillingtocompletethesaleandconsequently,decreedthesuitas
prayedfor.Itisagainstthejudgmentanddecree,thepresentappealhasbeenpreferred.
7.Itisalsonecessarytonoticethatduringthependencyoftheappeal,thesecondappellant
Raghavacharidiedon13.1.1998andanaffidavitwasfiledbyoneSrinivasan,PowerAgentof
thelegalrepresentativesofthedeceased
RaghavachariwhoareresidinginUnitedKingdom,andaccordingly,thelegalrepresentatives
ofthedeceasedRaghavachariwerebroughtonrecord.Further,it
is necessary to mention here that before the trial Court, the first defendant acted as the
Power of Attorney Agent for the second defendant and now, after the death of the second
appellant,athirdparty,oneSrinivasanisactingaPowerAgentforthelegalrepresentatives
ofthedeceasedseconddefendant.
8. Mr.T.R. Rajagopalan, learned senior counsel appearing for the appellants submitted that
the agreement for sale was entered into on 26.1.1977 and under the agreement, the
executionandregistrationofsaledeedshouldbecompleted
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within three months from the date of the agreement subject to satisfaction of certain
conditionsandthesuitwasinstitutedon12.1.1981andhence,thesuit
is barred by time in view of the Article 54 of the Limitation Act. Learned senior counsel
submittedthatthoughtherewasafurtheradvanceofRs.20,000on
23.1.1978, that would not extend the period of limitation. He referred toArticle 54 of the
LimitationAct,andsubmittedthatwhendatehasbeenfixed
for the performance of the contract, three year period referred to in Article 54 of the
LimitationActcommencedandbegantorunfrom26.4.1977andthe
limitationcannotbeextendedbyanyfurtherpayment.
9. Learned senior counsel also submitted that it is not the case of the plaintiff either in the
notice issued prior to the institution of the suit or in the plaint that because of want of
consentfromthecompetentauthority,sale
could not be effected. Learned senior counsel referred to Ex.A4 and submitted that there
wasnodemandfornoobjectioncertificateandthegroundsurgedin
the notice (Ex.A4) do not show that it is due to want of such consent of the competent
authoritythatthesalewasgettingpostponed.Thereforehesubmitted
that limitation for the institution of the suit commenced on 26.4.1977 and the time began to
runfrom26.4.1977,andthesuitshouldhavebeeninstitutedwithin3yearsfrom26.4.1977.
10. Learned senior counsel also submitted that the plaintiff was never willing and ready to
performherportofthecontractandshewasnotpossessed
of funds to pay the balance of sale consideration at any time. He referred to the pleadings
andalsotheorderpassedbythetrialCourtinI.A.No.5370of
1981 wherein the plaintiff has prayed for an interim injunction restraining the defendants
fromalienatingthesuitpropertyandthetrialCourthasgranted
interiminjunction,byorderdated31.3.1981,onconditionthattheplaintiffshoulddepositthe
balanceofsaleconsiderationofRs.26,000intoCourtonor
before22.4.1981(Ex.B3).LearnedSeniorCounselalsoreferredtothepetition
inI.A.No.6983of1981(Ex.B4)inI.A.No.5370of1981whereintheplaintiffhas
prayedforextensionoftimebysevendaysfrom22.4.1981forthedepositofthe
balanceofsaleconsideration.HereferredtotheorderpassedinI.A.No.6983of
1981whereinthetrialCourtheldthattherewerenomeritsinthepetition
seekingextensionoftimeandthereasonsgivenforextensionoftimearenot
bonafide,andonthosegrounds,thepetitionwasdismissed.Learnedsenior
counsel also referred to the affidavit filed along with I.A.No.6983 of 1981 seeking extension
oftimewhereintheplaintiffhasstatedthatshehadleftthe
amount of Rs.26,000 with her parents who were residing at their native place, Mysore and
herparents,inturn,lenttheamounttooneoftheirrelativesand
after the conditional order was passed by the Court, she asked her parents to make
arrangementstocollectthemoneyandsendthesame.Learnedseniorcounsel
alsoreferredtothestatementoftheplaintiffintheaffidavitthatshewaslaidupwithfever
for 10 days, and he also referred to the deposition of the plaintiff as P.W.1 wherein she has
statedthatthemoneywaskeptinherhouseandsincetheCourthasnotextendedthetime,
shecouldnotdepositthemoney.
Learnedseniorcounselthereforesubmittedthattheplaintiffhascomeforward
withafalsecaseandrenderedfalseevidenceinthematterofdepositofthebalanceofsale
considerationintoCourt.LearnedseniorcounselthereforesubmittedthatthetrialCourtwas
notcorrectinproceedingonthebasisthat
theCourthasthepowertograntextensionoftimeunderSection28(1)oftheSpecificRelief
Act. He submitted that the trial Court has overlooked the conflicting stand taken by the
plaintiffwhichwouldestablishthatthe
plaintiffhasnotcomeforwardwithcleanhandsandhence,theplaintiffisnotentitledtothe
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equitablereliefofspecificperformance.
11. Learned senior counsel also referred to Ex.A5 and submitted that bank account was
openedonlyonMay14,1981withasumofRs.6,201asopening
balance and in February, 1983 only, the balance was Rs.26,142,45. He referred to the
affidavitandalsotheevidenceoftheplaintiffandsubmittedthatthree
versions were given by the plaintiff as regards deposit of money. Learned senior counsel
submittedthatthereisnoevidencetoshowthatshehastakenanystep
to perform her part of the contract and according to the learned senior counsel, she has
cometotheCourtwithafalsecase.Learnedseniorcounselsubmitted
that the mere statement that she is ready and willing is not sufficient and the minimum
requirementthatshewaspossessedoffundsshouldbeestablished.
Learned senior counsel also submitted that it is not equitable to grant the relief of specific
performanceconsideringthelongpassageoftimefromthe
date of agreement, in view of the spiraling price of the property. Learned senior counsel
submittedthattheplaintiffhascomewithafalsecaseas
regards the possession of money and therefore the trial Court was not correct in granting
decreeforspecificperformanceinfavourofthelaintiff.Insupport
ofhissubmissions,learnedseniorcounselreliedonthefollowingdecisions:
1.MahaboobPashav.SyedZakeeruddin,2.Ramzan
v.Hussaini,3.M/s.CraftCentrev.Koncherry
CoirFactories,Cherthala,4.SpecialLand
AcquisitionOfficerv.GurappaChannabasappaParamaj,5.ThakammaMathew
v.M.AzamathullaKhan,
6.K.S.Vidyanadamv.Vairavan.
7.Koothapadayachiandanotherv.ArjunaPillai
andtwoothers,1998(1)LW3018.VyapuriGounderv.(Minor)Vijayanand
others,1978TLNI629.GurswamiGounderv.KesavaReddiarandanother,10.
Sankaran,S.andothers
v.N.G.Radhakrishnan,1994(2)LW64211.LourduMartDavidv.Louis
ChinnayaArogiaswamy,12.RamaswamyGounder
v.Venkatachalam,1976(I)MLJ24313.Pachaiappanandothersv.S.P.Koon
Man,1996(2)LW114.PitchanAmbalamv.KasiPitchanAmbatam,1996(2)LW
57715.SyedDastagirv.T.R.GopalakrishnaSetty,1999(7)Supreme17516.
Vasanthav.M.Senguttuvan,17.HisHolinessAcharyaSwamiGaneshDassjiv.
SitaRamThapar,18.K.Narendrav.Riviera
Apartments(P)Ltd.,19.V.S.Palanichamy
ChettiarFirmv.C.Alagappan,20.Gowrammal@
Gowriv.V.Pechimuthu,1996(2)LW41721.K.Kallaiahv.Ningegowda,.
12. Mr.N.S. Varadhachari, learned counsel appearing for the respondent referred to Ex.A2
and submitted that there is no dispute that Ex.A2 was attested by the first defendant. His
submission was that the parties never intended to put an end to the agreement and if the
intention of the parties was to put an end to the agreement, the endorsement and receipt
underEx.A2wouldnothavetakenplace.Hissubmissionwasthattimeisnotssenceofthe
contract. He referred to the written statement and submitted that as per the written
statement even after the death of Chengammal, the plaintiff was demanding that the sale
shouldbecompleted.Hesubmittedthatpriortothe
death of Chengammal, there was no question of abandonment of the contract and the
paymentunderEx.A2wasmadepriortothedeathofChengammal.Hesubmittedthatboth
the parties kept the agreement alive and hence, the first part of Article 54 of the Limitation
Act does not apply. He referred to the agreement and submitted that under clause7,
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sanctionofthecompetentauthorityis
requiredtobeobtained.HereferredtotheprovisionsofSection26oftheAct34of1976and
submittedthatsinceconsentwasneitherobtainedfromthecompetentauthority,noristhere
anyevidencetoshowthatanyapplicationwas
filedbeforethecompetentauthoritytoobtainconsent,thefaultisonthepartofthevendor
andthesecondpartofArticle54oftheLimitationActalonewouldapply.
13. Learned counsel further submitted that to keep the contract alive, the plaintiff has paid
moneyandafterChengammaldeath,theplaintiffhasbeen
demanding that the sale should be completed and the plaintiff has established that she is
capableofraisingthemoney.LearnedCounselsubmittedthatthe
fact that the plaintiff has filed an application for extension of time to deposit the balance of
saleconsideration,asorderedbytheCourtisnota
groundtostatethattheplaintiffwasnotreadyandwillingtopaythemoney.Learnedcounsel
alsosubmittedthatasregardshardshiptotheplaintiff,alltherelevantfactsshouldbetaken
intoaccount.
14.Learnedcounselalsosubmittedthattheseconddefendant,Raghavacharidiedduringthe
pendencyoftheappealandthelegalrepresentativesofthe
seconddefendants,whoareappellants3to6herein,areresidingintheUnitedKingdomand
theyhavegivenpowerofattorneyagenttoathirdpartywhereasthe
firstdefendantwasthepowerofattorneyagentoftheseconddefendantsincedeceasedand
thereisnoexplanationforthechangeofpowerofattorneyfrom
the first appellant to a third party. Learned counsel submitted that all the aspects of the
mattershouldbetakenintoaccount.Hesubmittedthathardship
shouldbeviewedbothfromthepointofviewoftheplaintiffandthatofthe
defendants.Hisfurthersubmissionwasthattheplaintiffhasnotcomewithfalsecasewhich
woulddisentitletheplaintifffromclaimingthereliefof
specificperformance.HesubmittedthatthestandoftheplaintifftakeninI.A.proceedingsis
notrelevantinconsideringthequestionwhethertheplaintiffis
entitled to the relief of specific performance. Learned counsel relied upon the following
decisionsinsupportofhissubmissions:
1.Lakshminarayanav.Singaravelu,2.K.Venkoji
Raov.M.AbdulKhuddurKureshi,3.Saraswatfii
Ammalv.JayaramaRaoandothers,1999(1)LW6834.GuruswamiGounderv.
KesaveReddiar,.
15. I have carefully considered the submissions of the learned counsel for the parties. The
pointsthatariseforconsiderationare(1)whetherthesuit
filed is barred by limitation(2) whether the plaintiff was ready and willing to perform her
part of the agreement and (3) whether the plaintiff is entitled to the relief of specific
performance.
16. Point No.1 The suit was filed on 12.1.1981 to enforce the agreement dated 24.1.1977.
Underclause7oftheagreement,theexecutionandregistrationof
sale deed should be completed within three months from the date of agreement subject to
certainconditions.Thatapart,therewasasubsequentpayment
towards sale consideration on 23.1.1978 which was acknowledged by the deceased
Chengammal.TherelevantArticleoftheLimitationActisArticle54andthe
saidArticlereadsasunder:
"For specific performance of a contract three years The date fixed for the
performance, or if no such dated is fixed, when the plaintiff has notice that performance is
refused."
17.UndertheaboveArticle,theperiodoflimitationforspecificperformanceofacontractis
threeyearsandunderthesaidArticle,thereare
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twoalternativepointsoftimewhichwouldbestartingpointforlimitationOnefromthedate
fixedfortheperformanceofthecontractandanother,ifdateis
notfixed,whentheplaintiffhadnoticedthattheperformancewasrefusedbytheotherparty.
IagreewithMr.T.R.Rajagopalan,learnedseniorcounselthat
thesubsequentpaymentmadeon23.1.1978doesnothavetheeffectofextendingtheperiod
oflimitationfromwhichthetimeforinstitutionofthesuitbegin
torun.Inmyview,learnedtrialJudgewasnotcorrectinholdingthatthetime
limit for institution of the suit should be computed from the date of subsequent payment. I
holdthatitisnotamoneysuit,butitisasuitforspecific
performance of contract and the subsequent payment has no effect while computing the
periodoflimitation.
18.However,Iamoftheviewthatthesubsequentpaymenthasrelevanceinconsideringthe
questionwhetherthepartiesintendedthattimeisessenceof
thecontract.IholdthattheconductofChengammalinreceivingmoneyon26.1.1978shows
thatthepartiesneverintendedthattimeisessenceofthecontract.Thewrittenstatementof
thefirstdefendantshowsthattillthetime
ofdeathofChengammal,thepartiesneverintendedthattimeistheessenceofthecontract.
Theavermentinparagraph8ofthewrittenstatementshowsthat
afterthedeathofChengammalin1979,theseconddefendantwasdemandingtheplaintiffto
completethesaletransactionwhichshowsthatthepartiesnever
intendedthattimeistheessenceofthecontract.
19.ThenextquestionthatarisesiswhetherthefirstpartorthesecondpartofArticle54of
theLimitationActwouldapplytothetransactioninquestion.Acarefulreadingofthevarious
decisionsrevealsthatifthedate
for the performance of agreement is fixed or can be inferred from the surrounding
circumstances,thenthefirstpartofArticle54oftheLimitation
Actwouldapplyandifnodatehasbeenfixedorinferred,thenthesecondpartofArticle54
oftheLimitationActwouldapply.UnderClause7ofthe
agreement, the execution and registration shall be completed within three months from the
dateofagreementsubjecttosanctionbythecompetentauthority.The
agreementalsoprovidesthatthesaleissubjecttosanctionbythecompetentauthority.Itis
nodoubttruethattheplaintiff,neitherinthenoticedated
7.1.1981, nor in the plaint, has stated about the failure on the part of the defendants to
obtainsanctionfromthecompetentauthorityundertheprovisions
of the Urban Land Ceiling Act, 1976. In the evidence also, the plaintiff has not deposed
anythingabouttherequirementofobtainingthesanctionfromthe
competent authority. I hold that notwithstanding the fact that the plaintiff has not stated
eitherinthenoticeorintheplaintorinhisevidenceaboutthe
requirement of obtaining the sanction from the competent authority, in considering the
questionswhetherthesuitisbarredbylimitationornot,and
whetheranydatehasbeenfixedfortheperformanceofthecontract,allthe
clausesintheagreementhavetobetakenintoaccount.
20. The agreement was entered into on 26.1.1977 and at the time when the agreement was
enteredinto,theprovisionsoftheTamilNaduUrbanLand(Ceiling
andRegulation)Act,1976,enactedbythePresidentofIndiabyvirtueofthepowerconferred
bySection3oftheTamilNaduStateLegislative(Delegationof
Powers) Act, 1976 was holding the field. Section 26 of the said Act imposed an embargo on
transferofanyurbanpropertyorurbanisablelandwithabuilding
(whether constructed before or after the commencement of the Act) by way of sale,
mortgage,giftorleaseforaperiodexceedingtenyearsofcommencement
of the Act or from the date on which the building is constructed, whichever is later, except
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withthepreviouspermissioninwritingfromthecompetent
authority. Section 27 of the said Act also imposed the ban on the registering authority to
register any transfer by way of sale, mortgage, gift, lease or otherwise of any urban
immovablepropertywithbuildingthereon,ifnecessary
certificate was not produced. Section 26 regulated the procedure for obtaining permission
fromthecompetentauthorityundertheUrbanLandCeilingAct,1976.
21. Admittedly, the agreement was entered into for the sale of an urban property with
buildingthereon.TheUrbanLandCeilingAct,1976wasinforcein
the State of Tamil Nadu till the Tamil Nadu Urban Land (Ceiling & Regulation) Act, 1976 was
enactedbytheStateLegislatureandtheStateActwaspublished
in Tamil Nadu Gazette on 17.5.1978. Therefore, during the currency of the operation of the
UrbanLandCeilingAct,1976(PresidentsAct),therewasa
prohibition against transfer of any urban property with building thereon without prior
permissioninwritingfromthecompetentauthority.Itisnotthecaseof
thedefendantsthattheyhaveappliedforpermissionforthetransferofthelandwithbuilding
thereon,butsuchpermissionwaseithergrantedorwasdeemed
to have been granted under Section 26(5) of the Urban Land Ceiling Act, 1976. It is also
significanttonoticethatasumofRs.20,000wasreceivedbyChengammal
in January, 1978 when the Urban Land Ceiling Act, 1976 was in force and therefore, the
limitationforfilingthesuitwouldcommenceon17.5.1978when
the Tamil Nadu Urban Land Ceiling Act, 1978 came into force repealing the Urban Land
CeilingAct,1976(PresidentsAct).
22. In so far as the decision of the Karnataka High Court in Mahaboob Pasha v. Syed
Zaheeruddin, is concerned, it is an authority for the proposition that where time for
performanceofcontractis
fixed,thelimitationbeginstorunfromthedatefixedforperformanceirrespectiveofthefact
whether time is essence of the contract or not. Applying the ratio of the Karnataka High
Court,sincetheagreementinthe
instantcaseissubjecttosanctionfromthecompetentauthorityundertheUrbanLandCeiling
Act,1976,itisnotpossibletoholdthatwithoutthesanction
fromthecompetentauthority,thetimetoinstitutethesuitwouldbegintorunfromthedate
fixedfortheperformanceoftheagreement.Iamunabletoaccept
the submission of Mr.T.R. Rajagopalan, learned senior counsel that limitation would begin to
runontheexpiryofthreemonthsfromthedateoftheagreement.
When there is a specific clause in the agreement that the sale is subject to the sanction of
thecompetitiveauthorityundertheUrbanLandCeilingAct,1976,
the limitation would not begin to run from the dated fixed for performance unless there is
evidencetoshowthattheconsentofthecompetentauthoritywasobtained.
23. In so far as the decision of the Supreme Court in Ramzan v. Hussaini, is concerned, the
Supreme Court held that though a specific date has not been mentioned for the seller to
executethedeedofsale,butthereisareference
to happening of certain event, immediately after happening of that particular event, the
period of limitation would begin to run. I hold that the decision of the Supreme Court in
Ramzanscase,isnotofmuchhelptothelearnedsenior
counselfortheappellantsforthesamereasonsstatedsuprawhiledistinguishingthedecision
oftheKarnatakaHighCourtinMahaboobPashascase,.
24. The decision of the Kerala High Court in M/s.Craft Centre v. Koncherry Coir Factories,
Cherthala,isofgeneralinnaturewhereintheCourtheldthat
theprovisionsoftheLimitationAct,particularlySection5,aremandatoryand
where the suit is barred by time on the face of it, the Court is duty bound to dismiss the
sameevenatappellatestagewithoutaquestionoflimitationisnot
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ofmuchhelptotheappellants.Theotherdecisionsrelieduponbythelearnedseniorcounsel
fortheappellants,viz.,0)SpecialLandAcquisitionOfficerv.
GurappaChannabasappaParamaj,and(ii)ThakammaMathewv.M.AzamathullaKhan,are
not
applicable to the facts of the case as the question whether the suit is barred by limitation
woulddependuponthefactsofeachcaseandhence,thedecisionsoftheSupremeCourtand
theKarnatakaHighCourtarenothelpfulto
thelearnedseniorcounselfortheappellants,
25.AsforthedecisioninK.Kallaiahv.Ningegowda,theKarnatakaHighCourthasheldthat
whendateisfixedfortheperformanceofcontract,thesuit
shouldberegulatedbytheformerpartoftheArticle54oftheLimitationAct,andnotbythe
latterpartofthesaidArticle.TheKarnatakaHighCourtalso
heldthatthedoctrine,timeisnottheessenceofcontracthasnothingtodowiththeperiodof
limitation.Asalreadyheldbyme,thequestionregardingthe
fixationoftimefortheperformanceofcontractwoulddependuponthefactsof
each case and since the sale is subject to the sanction from the competent authority under
theUrbanLandCeilingAct,1976,forthepurposeoflimitation
under Article 54 of the Limitation Act, it is open to the plaintiffs to take into account the
periodofoperationoftheUrbanLandCeilingAct,1976.
26.ThedecisionofthisCourtinKoothapadayachiandanotherv.Arjuna
Pillaiandtwoothers,1998(1)LW301wasrenderedwithreferencetothefacts
ofthatcase.Inthatcase,learnedJudgeheldthatlimitationforspecific
performanceofcontractwasthreeyearsfromthedatefixedfortheperformance
orifnodateisfixed,fromthedatewhentheplaintiffrefusedtoreceivethe
balanceofsaleconsideration.InKoothapadayachiscase,1998(1)LW301itwas
found,thetimefixedforperformancewasatanytimebefore15.6.1976andthis
Courtheldthatthesuitoughttohavebeenfixedwithinthreeyearsfromthat
date.Ihold,onthefactsofthepresentcase,thedateforperformanceofthe
contractistobeascertainedfromthedateofsanctionofthecompetent
authorityundertheUrbanLandCeilingAct,1976anditisnotpossibletohold
thatlimitationwouldbegintorunontheexpiryofthreemonthsfixedfromthe
dateofagreement.Asalreadyobservedbyme,thereisaconditionsuperaddedin
theagreementthatsanctionofthecompetentauthorityistobeobtained.
Therefore,thegrantofsanctionfromthecompetentauthorityisapreconditionforthesale
anditisnotpossibletoholdthatlimitationwouldbegintorun
beforetherepealoftheUrbanLandCeilingAct,1976(PresidentsAct)asthe
sanction under the said Act for the transfer of the property was not obtained during the
currencyofthesaidActandafteritsrepeal,theconditionimposed
intheagreementforsaletoobtainthesanctionfortransferisautomaticallylifted.
27.Ontheotherhand,thedecisionsrelieduponbythelearnedcounselfor
therespondentsupportthecaseoftherespondent.ThisCourtinLakshminarayana
v.Singaravelu,heldthatthedatedfixedforperformancemustbenotonlyadatewhichcan
beidentifiedwithoutanydoubtasaparticularpointoftimebut
itshouldalsobeadatewhichthepartiesintendedtobethedatewhenthecontractcouldbe
performed.Applyingthesaiddecision,thelimitationwould
begin to run after obtaining sanction from the competent authority. In K. Venkoji Rao v. M.
AbdulKhuddurKureshi,,the
KarnatakaHighCourthasreferredtotheearlierdecisioninMahaboobPashas
case,andheldthatwherethetimeis
extended, then the latter part of Article 54 of the Limitation Act would apply. In Saraswathi
Ammalv.JayaramaRaoandothers,1999(1)LW683,alearned
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JudgeofthisCourthasheldthatwhentimelimitisextendedandtherigorof
thetimelimitisgivenagobyandtheagreementdidnotconsidertimetobe
theessenceofthecontractthefirstpartofArticle54ofLimitationAct
wouldnotapplyandonlythe.latterpartofArticle54wouldapply.
28.FollowingtheratioofthedecisionofthisCourtaswellasthedecision
of the Karnataka High Court, I hold that time limit is not essence of the contract in the
instantcase.ThefactthatChengammalreceivedthemoneyin
January,1978afterexpiryofthreemonthsperiodfixedforperformanceofthe
contractshowsthatthetimeisnotessenceofthecontract.Theagreementis
alsosubjecttotheconditionofobtainingpriorsanctionfromthecompetent
authority.Consideringtheabovefacts,Iholdthatthetimeisnotessenceof
thecontractandsinceapprovalofthecompetentauthoritywasnotobtained
beforetherepealoftheUrbanLandCeilingAct,1976,Iholdthatthesecond
timeofArticle54oftheLimitationActwouldapplyandthesuitfiledon
12.1.1981isnotbarredbylimitation,eithertakingintoaccountthedateof
paymentinEx.A2orthedateofrepealoftheUrbanLandCeilingAct,1976
(PresidentsAct).
29.PointNo.2and3:Iamoftheviewthatboththepointscanbe
consideredtogether.Thequestionwhethertheplaintiffwasreadyandwillingto
performherpartoftheagreementhastobedecidedwithreferencetothe
conductofthepartiesandattendingcircumstances.TheSupremeCourtinthe
caseofHisHolinessAcharyaSwamiGaneshDassjiv.SitaRamThapar,pointsout
thedistinctionbetweenreadinessandwillingnessofplaintifftoperformhis
partofthecontractasunder:
"Byreadinessmaybemeantthecapacityoftheplaintifftoperformthe
contractwhichincludeshisfinancialpositiontopaythepurchaseprice.For
determininghiswillingnesstoperformhispartofthecontract,theconducthas
tobeproperlyscrutinised."
30.InSyedDastagirv.T.R.GopalakrishnaSetty,1999(7)Supreme175,the
SupremeCourtagainreiteratedthatcomplianceofreadinessandwillingnesshas
tobeinspiritandsubstance,andnotinletterandform.TheSupremeCourt
afterreferringtoSection16(c)oftheSpecificReliefAct,1963,heldas
under:
"Itissignificantthatthisexplanationcarvesoutcontractwhichinvolves
paymentofmoneyasaseparateclassfromSection16(c).Explanation(i)uses
thewords"itisnotessentialfortheplaintifftoactuallytendertothe
defendantortodepositinCourtanymoneyexceptwhensodirectedbytheCourt.
Thisspeaksinnegativetermwhatisnotessentialforplaintifftodo.This
moreinsupportofplaintiffthatheneednottendertothedefendantordeposit
inCourtanymoneybuttheplaintiffmust(asperexplanationii)atleastaver
hisperformanceorreadinessandwillingnesstoperformhisparttothe
contract."
31.InKoothapadayachiscase,1998(1)LW301,thisCourthasheldthat
factumofreadinessandwillingnessoftheplaintifftoperformhispartofthe
contracthastobeascertainedwithreferencetothecontractofthepartyand
theattendingcircumstances,andreadinessandwillingnessfromthedateof
agreementtillthedateofsaledeedshouldbepleadedandprovedandthisCourt
heldasunder:
"UnderSection16oftheSpecificReliefAct,readinessandwillingness
fromthedateofagreementtillthedateofsaledeedshouldbepleadedand
proved.Bytheplaintiffmakingastatementintheplaintthathewasreadyfrom
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thebeginningoftheyear1976,aninferencehastobedrawnthathewasnever
readyandwiltingtolakeasaledeedbeforethattime."
32.TheabovedecisionwasreiteratedbyalearnedJudgeofthisCourtin
Vasanthav.M.Senguttuvan,andafternoticingthedecisionoftheSupremeCourt
inGomatkinayagamPillaiandothersv.PalaniswamiNadar,AIR1967(II)SCWR
147,thisCourtheldasunder:
"InGomathinayagamPillaiandothersv.PalaniswamiNadar,AIR1967(II)
SCWR147,theSupremeCourtheldthatinasuitforspecificperformance,
plaintiffmustprovereadinessandwillingness.Therelevantportionofthesaiddecisionreads
thus:
"Therespondenthasclaimedadecreeforspecificperformanceanditisfor
himtoestablishthathewas,sincethedateofthecontract,continuouslyready
andwillingtoperformhispartofthecontract.Ifhefailstodoso,hisclaim
forspecificperformancemustfail.AsobservedbytheJudicialCommitteeofthe
PrivyCouncilinArdeshirMamav.FloraSeason".Inasuitforspecific
performance,ontheotherhand,hetreatedandwasrequiredbytheCourtto
treatthecontractasstillsubsisting.Hehadinthatsuittoallege,andif
thefactwastransversed,hewasrequiredtoproveacontinuousreadinessand
willingnessfromthedateofthecontracttothetimeofthehearing,toperform
thecontractonhispart.Failuretomakegoodthatavermentbroughtwithitthe
inevitabledismissalofhissuit.Therespondentmustinasuitforspecific
performanceofanagreementpleadandprovethathewasreadyandwillingto
performhispartofthecontractcontinuouslybetweenthedateofthecontract
andthedateofhearingofthesuit."
Evenifforsingleday,plaintiffagreementholderisnotreadytotakethe
saledeed,theequitableremedyshouldnotbegranted.Readinessandwillingness
mustbetherecontinuouslyfromthedateofagreementuptothedateofhearing."
33.InP.G,Tanawadev.G.B.Kadam,,theSupreme
Courthasheldthatwherethereisanavermentintheplaintthatpurchaser
sentregisterednoticestosellertoexecutesaledeedandwherethereisa
furtheravermentbybuyerthatasperagreementhewaswillingtopaythefees
requiredforsaledeed,costsofregistrationandbalanceamountofsaledeed
andwherebuyerhasalsodeposedbeforetheCourtthathewaswillingtopay
feesandalsothebalancesaleamount,itwasheldthatbuyerhasnotonly
averredbutalsoprovedthathewasreadyandwillingtoperformhispartofthe
contract.TheSupremeCourthasheldasunder
"Apartfromthesaidavermentsintheplaint,wefindthattheappellant,
inhisdepositionbeforetheCourt,hasstated:
IissuednoticetoheirsofJanabaltoexecutethesaledeed.Iwasready
topayremainingamountandactasperagreement.Thedefendantsdidnotexecute
thesaledeedaspernotice.Theyrepliedmynotice(Exh.50).Asdefendanisare
notwillingtoexecutethesaledeedIhavefiledthissuit.Iamreadytopay
remainingamountimmediately.Iamreadytopaycostsasperagreement.
7.RespondentNo.l,alsoinhisdepositionbeforetheCourt,hasstated:It
istruethatplaintiffwasreadyforsaledeed,butIwasnotready.
8.InviewoftheaforesaidstatementsoftheappellantandrespondentNo.l
aswellastheavermentscontainedin,paragraphs6and10oftheplaint,it
mustbeheld(hattheappellanthasnotonlyaverred,buthasalsoprovedthat
hewasreadyandwillingtoperformhispartofthecontractundertheagreement
forsale.TheappellateCourtandtheHighCourtwere,therefore,inerrorin
holdingthattheappellanthadfailedtocomplywiththerequirementsofSection
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16(c)oftheSpecificReliefActandtheappellantmustbeheldentitledtoa
decreeforspecificperformanceofthecontractinthesuitfiledbyhim."
34.InRamakrishnanv.Subbiah,1999(II)MLJ404,aDivisionBenchofthis
Courtheldthatpurchaserneednotproducethemoney,butmustfulfilthe
conditions,andthisCourtheldasunder:
"TherearecatenaofdecisionsofthisCourtandtheApexCourttothe
effectthatreadinessandwillingnessdonotimplythatthepurchasermust
producemoneyandtheconditionstobefulfilledarethatpurchaserhaddone
someactinfurtheranceofthecontractandtheactperformedbyhimwaswith
certainty."
ThereisnodisputethatduringthelifetimeofChengammal,on23.1.1978,a
sumofRs.20,000waspaidandafteradjustingtheadvancemoneyalreadypaidthe
plaintiffwasobligedtopaythebalanceofRs.26,000only.Intheplaint,the
plaintiffhasaverredthatshewasalwaysreadyandwillingtopaybalancesale
priceandcompletethetransaction.Intheletterissuedon7.1.1981(Ex.A4),
theplaintiffhasalsostatedthatshewasreadyandwillingtopaythebalance
saleamountandcompletethetransaction.ShehasproducedpassbookEx.A5to
provehercapacitytoraisemoneytopaythebalanceofRs.26,000.
35..Iholdthatitisnotessentialthatpurchasershouldproducemoneyin
cashbeforetheCourt,butitisnecessarythatthepurchasershouldactin
furtheranceofthecontractandtheactperformedbythepurchasershouldbe
withaviewtogetthedeedofsale.InsofarasthedecisionoftheSupreme
CourtinP.G.Tanawadescase,isconcerned,notonlythepurchaserthereinhas
madeastatementabouthisreadinessandwillingnesstoperformhimpartofthe
contract,butalsotheownerofthepropertyhasadmittedthattheplaintiffwas
readytogetthedeedofsaleexecuted.Inviewofthestatementofthe
purchaseraswellasthesellercoupledwiththeavermentscontainedinthe
plaint,theSupremeCourtheldthattheplaintiffwasreadyandwillingto
performhispartoftheagreementforsale.
36.TheSupremeCourtinSyedDastagirscase,1997(7)Supreme175heldthat
complianceofreadinessandwillingnesshastobeinspiritandsubstanceand
notinletterandformandthemechanicalreproductionofexactwordsofSection
cannotbeinsisteduponandtheavermentintheplaintthatmajorportionof
amounthadalreadybeenpaidandbalancesaleconsiderationwasdepositedonthe
dateoffilingsuitwouldestablishreadinessandwillingnessoftheplaintiff
asrequiredinSection16(c)oftheSpecificReliefAct.Asalreadyobservedby
me,thisCourtinKoothapadayachiscase,1998(1)LW301andinVasanthas
case,hasheldthattheagreementholdershouldprovehisreadinessand
willingnesscontinuouslyfromthedateofagreementtillthedateofhearing.
37.Asalreadyobserved,theagreementwasenteredintoon26.1.1977andthe
agreementstipulatesthatthebalancesaleamountshouldbepaidwithinaperiod
ofthreemonths.ApartofsaleconsiderationofRs.20,000waspaidon
23.1.1978.Thereisnoevidencetoshowastowhathappenedsubsequenttothe
partpaymentmadeon23.1.1978tillthenoticewasissuedbythedefendants
throughtheiradvocateson28.12.1980(Ex.A3)callingupontheplaintifftopay
arrearsofrentofthepropertyforthemonthsfromFebruary,1980toDecember,
1980.Meanwhile,Chengammalpassedawayin1978.Theplaintiffissuedalawyers
noticedated7.1.1981(Ex.A4)statingthatsheiswillingtopaybalanceof
saleconsideration,andsheinstitutedthesuiton12.1.1981.ThetrialCourt,
whilegrantinginteriminjunction,imposedaconditionthattheplaintiffshould
depositthebalanceofsaleconsiderationofRs.26,000intheCourtonorbefore
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22.4.1981andthesaidorderwaspassedon31.3.1981.Theplaintiffdidnot
depositthemoneywithinthetimestipulatedbytheCourt.Theplaintiff
approachedthetrialCourtforextensionoftimetodepositthebalanceofsale
considerationbysevendaysonthescorethatshehashandedovertheamountof
Rs.26,000toherparentsresidingattheirnativeplace,Mysore,whointurn,
lenttheamounttotheirrelatives.Inthepetition,shehasalsostatedthat
shewrotetoherparentstosendbackthemoneyandtheymadearrangementsto
collectandsendthemoney.Shehasalsostatedthatsinceshewaslaidupwith
fevertakingtreatment,shecouldnotgotothenativeplacepersonallyto
collectthemoneyandhence,shemadearrangementstocollectthemoneyandto
depositthesameintheCourt.ThetrialCourtrefusedtoextendthetimefor
depositofthebalanceofsaleconsideration.
38.Therefore,itisclearthatfromtheyear1978tilltheinstitutionof
thesuit,theplaintiffwasnotreadyandwillingtoperformherpartofthe
contract.Shehasnotestablishedthatshewaswillingtoperformherpartof
thecontractwithinareasonabletimefromthestipulatedperiod.Shehasnot
establishedthatshewasreadytopayortenderthebalanceofsale
considerationandcompletedeedofsaleafter1978.Itisalsorelevantto
mentionherethatshefellinarrearsinpaymentofrent.Anotherimportant
aspectisthatthoughtheplaintiffneednotproducethemoneyincash,whenthe
Courthasdirectedthattheplaintiffshoulddepositthebalanceofsale
considerationinCourtonorbeforeaparticularperiod,sheshouldhave
depositedtheamountasperthedirectionoftheCourt.Thefactthatshehas
notdepositedthebalanceofsaleconsiderationwithintheperioddirectedby
theCourtclearlyshowsthatshewasnotreadyandwillingtoperformherpart
ofthecontract.
39.InsofarasEx.A5isconcerned,theaccountwasopenedonlyinMay,
1981withinitialdepositofRs.6,201andexceptthedepositofsmallamounts
rangingfromRs.100toRs.400,substantialamountwasdepositedonlyonFebruary
23,1983.OnthedateofherexaminationinFebruary,1984,shehadasumof
Rs.6,013onlyinthebankaccount.ThoughthesumofRs.26,000maynotloom
largenowduetoinflationinthevalueofmoney,thesaidamountwasthe
substantialamountinearly80s.IftheamountofRs.26,000isnotthe
substantialamount,thereisnoexplanationfromtheplaintiffwhyshedidnot
depositorpaythesaidsumafterthelastpaymentwasmadeintheyear1978or
evenaftertheordersoftheCourtdirectinghertodepositthesaidmoney.The
plaintiffhasalsoadmittedthatshehasnotwrittenanyletterfrom1977till
thedateofsuiteithertoChengammalortothedefendantswithreferencetothe
agreementforsale.
40.IamunabletoacceptthesubmissionofMr.N.S.Varadhachari,learned
counselfortherespondentthatthefailureonthepartoftheplaintiffto
depositthebalanceofsaleconsiderationincomplianceoftheorderofthe
Courtforgrantinginteriminjunctionshouldbeoverlookedassuchfailurewould
resultonlyinnotsecuringtheinteriminjunctionasprayedforandthatwould
notbearelevantcircumstancetoestablishherreadinessandwillingnessto
performherpartofthecontract.ItisnodoubttruethatthetrialCourthas
directedtheplaintifftodepositasumofRs.26,000beingthebalanceofsale
considerationasaconditionforgrantofinteriminjunctionandwhentheCourt
hasdirectedthedepositofthebalanceofsaleconsideration,theplaintiff
shouldhavecompliedwiththedirectionsoftheCourtandtheinferencetobe
drawnfromherfailuretodosoisthattheplaintiffwasnotpossessedoffunds
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andshewasnotreadyandwillingtoperformherpartofthecontract.
41.ThisCourtinVasanthav.M.Senguttuvan,held
thatevenifforasingleday,plaintiff/agreementholderisnotreadyto
takethesaledeed,theequitableremedyshouldnotbegranted.Applyingthe
ratioofthecase,theplaintiffhasnotshownherreadinessandwillingness
from1978to1981andevenafterthefilingofthesuit,whentheCourt,atthe
stageofgrantinginteriminjunction,directedhertodepositthebalanceof
salewithinthetimegrantedwhichshefailedanditclearlyshowsthatthe
plaintiffdidnothavethenecessarymoneytocomplywiththedirectionofthe
Courtandshewasnotreadyandwillingtoperformherpartofthecontract.The
orderofthetrialCourtrefusingtoextendthetimefordeposithasbecome
final.Furtherthereisnoevidencefromtheplaintiffthatshewasreadyand
willingtoperformherpartofagreementafterthedeathofChengammaltillthe
dateofthesuitnoticeintheyear1981.However,intheplaint,theplaintiff
hasstatedthatshehasdemandedthedefendantsfortheexecutionofsaledeed
informingthatshewasreadyandwillingtopaythebalanceofsale
considerationandcompletethesaletransaction.Theplaintiffhasalsonot
provedherstatementthatthedefendantshadpromisedherseveraltimesto
completethetransactionbutfailedforthereasonsbestknowntothem.Onthe
otherhand,itisthecaseofthedefendantsthatevenafterthedeathof
Chengammal,theseconddefendantwasdemandingtheplaintifftocompletethe
transaction,buttheplaintiffwasnotreadytopaythebalanceofsale
considerationandsherequestedextensionoftimeforpayment.Iholdthatina
suitforspecificperformance,itisforplaintifftoestablishhis/her
readinessandwillingnessfromthedateofagreementtillthedateofsale.In
theinstantcase,theplaintiffhasnotestablishedthatshewasreadyand
willingtoperformherpartofthecontract.Theplaintiffhasalsonot
establishedthatshewasrunningahandicraftbusiness:shehasnotevenstated
theplaceofthebusinessandwhatwastheturnoverfromthebusiness.Itis
relevanttonoticethatshehasnotexaminedanyoftheemployees,nordidshe
produceanydocumenttoshowthatshewascarryingonthehandicraftbusiness.
Exceptherevidence,thereisnoindependentevidencetoshowthatherhusband
wasanincometaxassesseeandtheplaintiffhasnotproducedanydocumentto
showthatherhusbandwasanincometaxassessee.Iholdthatfromthedatethe
lastpaymentofRs.20,000wasmadetillthedateofthesuit,nearlyfora
periodofthreeyears,theplaintiffhasnotestablishedthatshewasreadyand
willingtoperformherpartofthecontractandshewasalsonotableto
establishherreadinessandwillingnessevenaftertheinstitutionofthesuit.
Thefactthatshegavedifferentversionsregardingherfailuretodepositthe
moneyorderedtobedepositedclearlyshowsthatshehasnotcomeoutwithtrue
facts.
42.ThetrialCourtproceededonthebasisthatthemeredelaywouldnot
preventtheplaintifffromobtainingdecreeforspecificperformance.Thetrial
CourtrelieduponthedecisionofthisCourtinS.V.SankaralingaNadarv,
P.T.S.RatnaswamiNadar,
whereinthisCourtheldthatmereriseinpriceisnotagroundfordenying
thespecificperformance.However,theSupremeCourttookadifferentviewin
thecaseofK.S.Vidyanadamv.Vairavan,whereintheSupremeCourt,after
noticingthe
decisioninSankaralingaNadarscase,heldasunder:
"Withgreatrespect,weareunabletoagreeifthesaiddecisionis
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understoodassayingthatthesaidfactoris,notatalltobetakeninto
accountwhileexercisingthediscretionvestedintheCourtbylaw.Wecannotbe
oblivioustotherealityandtherealityisconstantandcontinuousrisein
thevaluesofurbanpropertiesfuelledbylargescalemigrationofpeoplefrom
ruralareasofurbancentresandbyinflation.Takethisverycase,the
plaintiffhadagreedtopaythebalanceconsideration,purchasethestamppapers
andaskfortheexecutionofsaledeedanddeliveryofpossessionwithinsix
months.Hedidnothingofthesort.Theagreementexpresslyprovidesthatifthe
plaintifffailsinperforminghispartofthecontract,thedefendantsare
entitledtoforfeittheearnestmoneyofRs.5,000andthatifthedefendants
failtoperformtheirpartofthecontract,theyareliabletopaydoublethe
saidamount.ExceptpayingthesmallamountofRs.5,000(asagainstthetotal
considerationofRs.60,000)theplaintiffdidnothinguntilheissuedthesuit
notice21/2yearsaftertheagreement.Indeed,weareinclinedtothinkthat
therigoroftheruleevolvedbycourtsthattimeisnotoftheessenceofthe
contractinthecaseofimmovablepropertiesevolvedintimeswhenpricesand
valueswerestableandinflationwasunknownrequirestoberelaxed,ifnot
modified,particularlyinthecaseofurbanimmovableproperties.Itishigh
time,wedoso.Thelearnedcounselfortheplaintiffsaysthatwhentheparties
enteredintothecontract,theyknewthatpricesarerisinghence,hesays,rise
inpricescannotbeagroundfordenyingspecificperformance.Maybe,the
partiesknewofthesaidcircumstancebuttheyhavealsospecifiedsixmonthsas
theperiodwithinwhichthetransactionshouldbecompleted.Thesaidtimelimit
maynotamounttomakingtimetheessenceofthecontractbutitmustyethave
somemeaning.Notfornothingcouldsuchtimelimitwouldhavebeenprescribed.
Canitbestatedasaruleoflaworruleofprudencethatwheretimeisnot
madetheessenceofthecontract,allstipulationsoftimeprovidedinthe
contracthavenosignificanceormeaningorthattheyareasgoodasnon
existent?Allthisonlymeansthatwhileexercisingitsdiscretion,theCourt
shouldalsobearinmindthatwhenthepartiesprescribecertaintimelimit(s)
fortakingstepsbyoneortheotherparty,itmusthavesomesignificanceand
thatthesaidtimelimit(s)cannotbeignoredaltogetheronthegroundthattime
hasnotbeenmadetheessenceofthecontract(relatingtoimmovable
properties)."
43.Iamoftheviewthatthecompleteinactiononthepartoftheplaintiff
foraperiodofnearlythreeyearscoupledwiththeriseinthevalueofthe
propertyshouldbetakenintoaccountinconsideringthequestionwhetherthe
reliefofspecificperformanceshouldbegrantedinfavouroftheplaintiffor
not.ThetrialCourtcompletelyignoredtotakeintoaccounttheeffectof
failureonthepartoftheplaintifftocomplywiththeordersoftheCourtto
depositthebalanceofsaleconsiderationontheground,theCourt,under
Section28(1)oftheSpecificReliefAct,afterdecreeingthesuitforspecific
performance,hasthepowertopermitthepurchasertodepositthebalanceof
saleconsiderationwithinastipulatedtimeandalsotoextendthetime
subsequently.Inmyview,thepoweravailableunderSection28oftheSpecific
ReliefActisfardifferentfromconsideringthequestionwhethertheplaintiff
wasreadyandwillingtoperformherpartofthecontract.
44.Inmyview,themereassertionthatshewasreadyandwillingtoperform
herpartofthecontractisnotsufficientwhentheavermentwasdenied.As
observedbytheSupremeCourt,themerecomplianceoftheformisnotsufficient
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andthespiritbehindthesectionshouldbetakenintoaccount.Iholdthaton
thefactsofthecase,therewasaspecificdirectionbytheCourttodeposit
thebalanceofsaleconsideration,thoughorderedforsomeotherpurpose,the
failuretodepositthebalanceofsaleconsiderationasorderedbytheCourt
withinthetimestipulatedisarelevantcircumstancethatshouldbetakeninto
accountindecidingthequestionwhethertheplaintiffwasreadyandwillingto
performherpartofthecontract.
45.Further,theplaintiff,inthepetitionforextensionoftime,hasstated
thatmoneywasleftwithherparentsresidinginthenativeplace,Mysore.
However,intheevidence,shehasstatedthatshekeptthemoneyinthehouse
andsincetherewasnoorderoftheCourttodeposittheamount,shecouldnot
depositthemoney.Duringthecourseofcrossexamination,shehasalsostated
thatshehadasumofRs.20,000incashandshegavethemoneytoherfatherand
shehadkeptthemoneyincashduringDecember,1981.Inherchiefexamination,
shehasstatedthatshewasdirectedtopayasumofRs.26,000onorbefore
22.4.1981andshefiledapetitionforextensionoftimebysevendays,anddue
toherillhealth,shewasnotabletodepositthemoney.Atthatpointoftime,
attherequestofthecounselfortheplaintiff,thecasewasadjournedtonext
week.Nextweek,theplaintiffwasexaminedandshehasstatedthatshewas
keepingthemoneyinherhouseandsincetherewasnoorderoftheCourt,she
couldnotdepositthemoney.Incrossexamination,shehasstatedthatwhenthe
suitwasfiledon12.1.1981,shetookalongwithhertheagreementandthebank
passbookalso.Shehasalsoadmittedthatshehasonlyonebankaccount,viz.,
Ex.A5.ItisseenfromEx.A5thatthebankaccountwasopenedinMay,1981and
therefore,inmyview,thestatementoftheplaintiffthattheplaintwas
preparedonthebasisofthebankpassbookisnotcorrect,becausetheaccount
wasopenedinMay,1981,subsequenttothefilingofthesuit.Acarefulreading
oftheevidenceofP.W.1clearlyshowsthatshehasgivendifferentversionsand
changedherversionevenduringthecourseofherexamination.
46.ThetrialCourtwasoftheviewthatthesellerhasnotproducedthe
documentsoftitletothepurchaserandhence,theplaintiffwasunableto
performherpartofthecontract.Acarefulreadingoftheagreementshowsthat
thevendorwasrequiredtoproduceencumbrancecertificateforoneyear.The
plaintandevidenceoftheplaintiff,ontheotherhand,showthatasperthe
agreementthesellerwasrequirednotonlytoproduceencumbrancecertificate,
butalsotitledeedsrelatingtothesuitproperty.However,Ifindthatthere
isnosuchclauseregardinghandingoverdocumentsoftitletotheplaintiff.
ThetrialCourthasproceededonthebasisthatthevendorwasrequiredtohand
overthedocumentsoftitletothepurchaser.Theevidenceoftheplaintiffalso
showsthatshehasnotwrittenanylettertothedefendantsortheirmother
demandingproductionofencumbrancecertificateordocumentsoftitle.Asa
matteroffact,inthelawyersnotice,Ex.A4,thereisnoallegationregarding
nonfurnishingofdocumentsoftitleorencumbrancecertificate.Theonlypoint
thatwasraisedinthenoticewasthatthefirstdefendanthasnotproducedthe
powerofattorneyexecutedbytheseconddefendantinfavourofthefirst
defendantempoweringhertocollecttherent.Thoughsuchastandwastakenin
thenoticedated7.1.1981(Ex.A4),theplaintifffiledthesuitagainst
defendants1and2aloneonthegroundthattheyarelegalheirsofChengammal.
Further,itisalsoevidentthatevenafterthedeathofChengammal,the
plaintiffhasbeenpayingrenttillJanuary,1980tothefirstdefendantandat
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nopointoftime,shehasraisedapleathatthedefendantsarenotlegal
representativesoflateChengammalorthereareotherlegalrepresentatives
besidesthedefendants.Itisalsorelevanttonoticethattheplaintiffhas
admittedthatsheknewwhoarethelegalheirsofthedeceasedChengammalandin
spiteofthat,shehasnottakenanystepstoenforcetheagreement.
47.ThetrialCourtwaschieflyinfluencedbythestatementofD.W.1thatin
January,1980,theplaintiffhadstatedthatshewasreadytocompletethesale.
ThetrialCourtrelieduponthatstatementofD.W.1,butitisrelevantto
noticethatthefirstdefendanthasalsostatedthattheplaintiffwasnotready
withmoneyinJanuary,1980andtheplaintiffhasnotpaidarrearsofrentor
balanceofsaleconsideration.Ontheotherhand,theplaintiffhasnotletin
anyfurtherevidencetoshowthatshewasreadytocompletethesaletransaction
eveninthemonthofJanuary,1980.ThetrialCourtproceededonthebasisthat
thereisdefaultonthepartofthedefendantstoproducedocumentsoftitleand
encumbrancecertificateasperagreementforsale.Asalreadyobservedbyme,
thereisnorequirementundertheagreementforsalethatthevendorshouldhand
overtitledeedstothepurchaser.Therewasnodemandbytheplaintiffforthe
inspectionoftitledeeds.
48.Insofarasencumbrancecertificateisconcerned,thevendorwas
requiredtoproduceencumbrancecertificateforaperiodofoneyearfrom
September,1976onthedateofexecutionofsaleandthatperiodalsoexpiredin
September,1977.Iamoftheview,theplaintiffhaskeptquiet,becauseshewas
inpossessionofthesuitpropertybypayingrentforsometime.Afterthedeath
ofChengammalin1978,theplaintifffallinarrearsinpaymentofrentfrom
January,1980.Takingintoaccounttheoverallviewofthematter,Iholdthat
theplaintiffwasnotreadyandwillingtoperformherpartofthecontract
afterthepaymentofRs.20,000inJanuary,1978.Thoughthesaidpaymenthas
indicatedthatshewasreadyatthattime,hersubsequentconductshowsthatshe
wasnotreadyandwillingtoperformherpartofthecontract.Further,shehas
alsocomeforwardwithconflictingversionsbothintheaffidavit(Ex.B4)and
intheevidenceregardingtheavailabilityofmoneyofRs.26,000.Itiswell
settledbyvariousdecisionsofthisCourtthatwheretheplaintiffhassetupa
falsecase,sheisnotentitledtothereliefofspecificperformance.Ihold
thatonthevitalandimportantaspectwithreferencetothedepositofbalance
ofsaleconsideration,theplaintiffhasnotgiventruefactswhichdisentitle
theplaintifffromclaimingthereliefofspecificperformance.Thevarious
decisionsrelieduponbythelearnedcounselfortheappellantsonthisaspect
dosupportthecaseoftheappellants.
49.InsofarasthedecisionofthisCourtinGuruswamiGounderv.Kesave
Reddiar,whereinitwasheldthatitisnot
everyincorrectcasepleadedbyplaintiffthatwoulddisentitlehertoclaim
thereliefisdistinguishableasinthatcasetherewasanalternativeplea
expressingreadinessandwillingnesstodepositentiresaleconsiderationif
earlierpleaofpartpaymentwasnotacceptedandthisCourtheldthatitwould
dependuponthefactsofeachcaseandthereisnouniformstandardorformula
dealingwithallmatters.TheabovedecisioninGuruswamiGounderscasewas
approvedbyaDivisionBenchofthisCourtinPachaiappanandothersv.S.P.
KoonMari,1996(2)LW1.
50.However,onthefactsofthepresentcase,thefalsecasesetupbythe
plaintiffasonthematerialaspectandaffectsthemaincaseonthequestion
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7/16/2016
whethertheplaintiffwasreadyandwillingtoperformherpartofthecontract.
Ultimately,itwoulddependuponthefactsofeachcasewhetherfalsecaseis
materialorimmaterialandIholdthatthepleaputforwardregardingthe
availabilityoftheamountofbalanceofsaleconsiderationisamaterial
considerationandhence,theratiooftheDivisionBenchofthisCourtin
Pachaiappanscase,1996(2)LW1isnotapplicable.Iholdthatthestatement
oftheplaintiffintheplaintthatshewasreadyandwillingtopaythebalance
ofsaleconsiderationandcompletethesaletransactioncannotbestatedtobe
trueinviewofherinabilitytocomplywiththeordersoftheCourttodeposit
thebalanceofsaleconsideration.Shehasalsonotestablishedthatshewas
readyandwillingtoperformherpartofagreementbypayingthebalanceofsale
considerationtothedefendantsfrom1978to1981whenthesuitwasinstituted.
51.Inthecircumstances,Iholdthattheplaintiffhassetupafalse
regardingherreadinessandwillingnessanditisamaterialconsiderationto
considerthequestionwhethertheplaintiffisentitledtothereliefof
specificperformance.Ialsoholdthatthefactthatthereisachangeinthe
powerofattorneyholderdoesnotmakeanydifference.Evenassumingandfor
whichthereisnoevidencethatthedefendantshavesubsequentlyenteredintoan
agreementforsalewiththepowerofattorneyholderofthelegalheirsofK.
Raghavachari,thatwillnotentitletheplaintifftothereliefofspecific
performancewhentherewasacompleteinactiononherpartfrom1978to1981and
duringthatperiod,shehadnotshownherreadinessandwillingnesstoperform
herpartoftheagreement.
52.IholdthatthetrialCourthasexerciseditsdiscretioningrantingthe
equitablereliefnotproperlyanderredingrantingthereliefwhichisnot
warrantedonthefactsofthecase.Iholdthattheplaintiffisnotentitledto
thereliefofspecificperformance.Thepoints2and3areansweredinfavourof
theappellants.
53.Theresultistheappealisallowedandthejudgmentanddecreeofthe
trialCourtaresetasideandthesuitshallstanddismissed.Therespondent
willbeentitledtothemoneypaidbyher.Sincethemoneyhasbeenpaidinthe
years1977and1978,theappellantsaredirectedtoreturntheamountreceived
with12%interestfromthedateofreceipttillthedateofpayment.The
appellantisentitledtocostsherein.
18/18

Burdon of Proof in A Suit For Specific Performance

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7/16/2016

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