Adilingam and Sankaralingam vs Narayanan and Others

Hon''ble Mr.Justice R.S. Ramanathan

Defendants 2 and 4 are the appellants.

The first respondent filed the suit for specificperformance of an agreement of sale dated 5.5.1993 executedby the father of the appellants and respondents 2 to 8agreeing to sell the suit property at the rate of Rs.300/=per cent and received an advance of Rs.25,950/= and ninemonths time was fixed for payment of balance saleconsideration of Rs.1,29,850/=. As the father of theappellant Mahalingam failed to execute the sale deed, thesuit was filed by the first respondent for specificperformance. The case of the first respondent was that thesuit property belonged to Mahalingam, the deceased firstdefendant and it was his separate property and he agreed tosell the suit property for Rs.300/= per cent and receivedRs.25,950/= and executed the agreement of sale dated5.5.1993 and thereafter, he did not evince any interest andtherefore, the first respondent issued notice dated8.9.1993 calling upon the deceased first defendant toexecute the sale deed on receipt of balance saleconsideration and the deceased first defendant admitted the execution of the agreement of sale and sent a reply on7.10.1993 stating that without consulting his sons, he hadexecuted the agreement of sale and the properties are thejoint family properties of himself and the sons and thesons are objecting to the same and requested the firstrespondent to cancel the agreement and get back theadvance amount.

The first appellant and the second respondent sent reply stating that by practising fraud on their father, theagreement was obtained for a low price and the properties belong to them jointly and therefore, requested the firstrespondent to cancel the agreement and get back theadvance. As the deceased first defendant failed to executethe sale deed, the suit was filed for specific performance.

The deceased first defendant died before filingwritten statement, and therefore, his legal representativeswere added as defendants 2 to 10. The second defendantviz., the first appellant filed a statement stating thatthe property belong to them jointly and his father had noright to execute the agreement of sale in favour of thefirst respondent herein and they have not given consent for the sale and by practising fraud, the signature of the father was obtained by the first respondent with the helpof one Palani Chettiar and he also stealthily obtained theoriginal sale deed in favour of their father and the thirddefendant and the second respondent herein also filed thesuit for partition in O.S.No.284 of 1994 and as such, thefirst respondent/plaintiff is not entitled to the relief ofspecific performance.

The fifth defendant also filed statement statingthat he was lured by Palani Chettiar and at his instance,he also helped his father to enter into the agreement ofsale with the first respondent without knowing the malafide intention of the first respondent/plaintiff andtherefore, the sale agreement is not valid and the firstrespondent/plaintiff is not entitled to the relief prayedfor.

The present appellants, who were defendants 2 and 4remained ex parte in the suit and the suit was contested bydefendants 3, 5 and 7.

The Trial Court held that the property was theseparate property of the deceased first defendantMahalingam and it was not the joint family property ofMahalingam and his sons and that Mahalingam entered into the agreement of sale voluntarily and no fraud has beenpractised upon him and considering the price hike, hewanted to rescind from the agreement of sale and issuedreply notice and the first respondent proved his readinessand willingness to proceed with the agreement of sale anddecreed the suit as prayed for. Nevertheless the TrialCourt did not award cost to the first respondent.Therefore, the first respondent filed A.S.No.27 of 2007against the judgment and decree insofar as the cost isconcerned and defendants 2 to 5, and 7, 8 and 10 filedA.S.No.28 of 2007 against the judgment and decree grantedin favour of the first respondent. The first appellatecourt also independently appreciated the facts and law andconfirmed the judgment of the Trial Court insofar as thespecific performance of the agreement of sale and allowedthe appeal filed by the first respondent and awarded cost. Hence, these two second appeals.

Mr.S.Parthasarathy, learned Senior Counsel appearing for the appellants submitted that having regardto the recital in the agreement of sale, viz., in the eventof breach committed by the deceased first defendant, thefirst respondent can treat the agreement of sale as sale deed and deposit the balance sale consideration into courtand apply for compulsory registration, admittedly, thefirst respondent did not act according to the terms of theagreement of sale by depositing the balance saleconsideration as stipulated in the agreement and hence, hehas committed breach of condition and therefore, he is notentitled to the relief of specific performance. In supportof his contention, he relied upon the decision in R. Rajram v. T.R. Maheswaran (2010) 2 MLJ 253. The learned SeniorCounsel further submitted that both the courts below erredin holding that the suit property was the separate propertyof the deceased first defendant Mahalingam, without properly appreciating the evidence of DW1 to DW3 and evenassuming that the suit property was the separate property of Mahalingam, the said Mahalingam, deceased firstdefendant sent a reply notice in October 1993 informingthe first respondent that his sons are objecting to the agreement of sale and requested the firstrespondent/plaintiff to cancel the agreement and receivethe advance amount and his two sons had also sent a replystating that fraud has been practised upon their father ingetting the agreement of sale and the properties are the joint family properties of father and sons and therefore,the father cannot execute the agreement of sale in favourof the first respondent and despite the same, the firstrespondent did not file the suit immediately and he filedit only on 24.9.1994 and that would show that he was notready and willing to perform his part of the contract andtherefore, the suit is liable to be rejected.

On the other hand, Mr.P.B.Balaji, learned counselfor the first respondent submitted that both the courtshave elaborately appreciated the evidence and rightly heldthat the property was the separate property of Mahalingam,the first defendant and he also admitted the execution ofthe agreement of sale and without causing any delay, thesuit was filed and therefore, both the courts have rightlyexercised the discretion and granted the relief and theconcurring findings of fact need not be interfered with inthe second appeal.

On the above pleadings, the following substantialquestions of law arise for consideration in the second appeal:-

Whether the first respondent hascommitted breach of conditions in the agreement of sale and therefore, he isnot entitled to the relief of specific performance?

Whether the first respondent was readyand willing to perform his part of the contract?

Learned Senior Counsel Mr. S. Parthasarathy reliedupon the judgment reported in (2010) 2 MLJ 253 andsubmitted that in a similar circumstance, this court has held that when the plaintiff did not deposit the amount, hehas committed breach of condition and therefore, he is notentitled to the discretionary relief of specificperformance.

I am unable to accept the contention of the learned Senior Counsel. In the above judgment, this courthas considered a clause in the agreement of sale by whichthe agreement holder was directed to deposit the balancesale consideration before the court and to file the suitfor specific performance, in the event of failure on thepart of the executant to execute the sale deed. In thatcircumstance, the learned Judge held that while filing thesuit for specific performance, the plaintiff did not deposit the balance sale consideration as stipulated in theagreement and depositing of balance sale considerationbefore filing the suit for specific performance was acondition precedent as per the agreement and the plaintiffviz., the agreement holder in that suit failed to depositthe amount and therefore, he committed breach of contractand therefore, he is not entitled to the relief of specificperformance. In this case, the recitals are not identicaland as stated supra, it was only stated that in the eventof failure on the part of the deceased first defendant inexecuting the sale deed, the agreement holder shall depositthe amount before the court and treat the agreement of saleas sale deed and apply for compulsory registration.Therefore, the wordings in both the agreements aredifferent and in the agreement which was the subject matterof the judgment reported in (2010) 2 MLJ 253, theagreement holder was directed to deposit the amount incourt and file the suit for specific performance. In the circumstances, the learned Judge held that the conditionwas prescribed under the agreement of sale and thatcondition was not complied with and therefore, theagreement holder is not entitled to the relief of specific performance. But, in this case, there was no suchcondition that before filing the suit for specificperformance, the first respondent/plaintiff has to depositthe amount. It was only stated that the firstrespondent/plaintiff shall deposit the amount and treat theagreement of sale as sale deed and apply for compulsoryregistration.

It is well known that the agreement of sale cannotbe treated as a sale and the plaintiff/first respondentcannot apply for compulsory registration as per thecondition stated in the agreement of sale. He has to filethe suit for specific performance for enforcing theagreement of sale. Hence, the condition stated thereincannot be construed as a condition precedent for enforcingthe agreement of sale.

Further, it is also against the provisions ofsection 16(c) and the explanation attached to that section.As per Section 16(c) of the Specific Relief Act, where acontract involves payment of the money, it is not essentialfor the plaintiff to actually tender to the defendant or todeposit in court any money except when so directed by thecourt. Therefore, the section specifically says that there is no necessity on the part of the plaintiff, who sues forspecific performance, to deposit the amount into court andit is the well known proposition that no one can enter intoan agreement against the statute. When the statute doesnot prescribe or does not compel a person to deposit thebalance sale consideration before filing a suit forspecific performance, even though there is a clause in theagreement of sale that the party, who applies for specificperformance, has to deposit the amount in court, there isno necessity on the part of the party to deposit the amountand if he is capable of proving that he has got the meansto pay the balance sale consideration, that is sufficientand there is no necessity on the part of the plaintiff, whofiles the suit for specific performance, to deposit theamount.

Therefore, as per the explanation to section 16(2) of the Specific Relief Act, the plaintiff/first respondentis not obliged to deposit the amount before filing the suitfor specific performance and this aspect was not properlyappreciated by the learned Judge in the judgment reportedin (2010) 2 MLJ 253. Therefore, the failure to deposit theamount before the court before filing the suit for specific performance will not disentitle the first respondent fromclaiming the suit for specific performance and thecondition stated in the agreement of sale cannot beenforced in a suit for specific performance as section 16(c) and the explanation attached to that section does notrequire the person to deposit the amount before filing thesuit for specific performance. Hence, the first respondent

Both the courts below concurrently held that theproperty was the separate property of the first defendantand he entered into the agreement of sale and the firstrespondent also proved his readiness and willingness toperform his part of the contract. In Ex.A4, reply sent bythe first defendant, he admitted the execution of theagreement of sale and he only stated that he did notconsult his sons before entering into the agreement of saleand therefore, the advance may be obtained from him and theagreement may be cancelled.

In Ex.A3, notice sent by one of his sons, it wasalso admitted that the agreement of sale was executed and by practising fraud, it was obtained. Both the courts haveclearly held that when the property was purchased in theyear 1956, the second defendant was aged four years and thethird defendant was born in the same year and therefore, itcould not have been purchased by the joint earnings asstated in the written statement. Further, two other sons ofthe deceased first defendant viz., Jambulingam andSankaralingam also admitted the agreement of sale and thesecond appellant though admitted the agreement of sale, hasfiled the appeal stating that the agreement of sale wasobtained by fraud. Therefore, when the property was theseparate property of the deceased first defendant, he wascompetent to enter into the agreement of sale and alsoadmitted the execution of sale and his only objection wasthat the adjacent lands were sold for higher price andtherefore, his sons are objecting to the sale of theproperty.

As per the agreement of sale, nine months time wasfixed in the agreement of sale dated 5.5.1993 and afterissuing notice on 8.9.1993, followed by another noticedated 9.9.1993, the suit was filed on 24.9.1994 and thefirst respondent also averred in the plaint about the readiness and willingness and therefore, he proved hisreadiness and willingness by entering into the box and alsoproved the execution of the agreement by examining P.Ws.2and 3 and DW1, the second defendant also admitted in cross-examination that the agreement of sale was executed by hisfather and considering all these aspects, both the courtsbelow have rightly held that the agreement of sale wasexecuted by the deceased first defendant and it was hisseparate property and the first respondent was ready andwilling to perform his part of the contract and decreed thesuit. Hence, I do not find any infirmity in the findingsof the courts below relating the readiness and willingnesson the part of the first respondent/plaintiff. Hence, boththe courts below have rightly held that the firstrespondent is entitled to the relief of specificperformance and granted the decree and I do not find anyreason to interfere with the concurrent findings of thecourts below. The second substantial question of law isalso answered against the appellant.

When a suit for specific performance is decreedholding that the plaintiff was ready and willing toperform his part of the contract and he has not committed has not committed any breach and the first substantial question law is answered against the appellant and in favour of the first respondent. any breach, as a natural corollary, he must be awardedcost, but, without assigning any reason, the Trial Courtdeclined to award cost to the first respondent/plaintiffand the mistake was rectified by the first appellate courtand the first appellate court has awarded cost thereon andI do not find any reason to interfere with the judgment anddecree of the first appellate court in awarding cost tothe first respondent/plaintiff.

In the result, both the second appeals are dismissedand the judgment of the Trial Court relating to specificperformance and the judgment and decree of the firstappellate court regarding cost are confirmed. There is noorder as to costs in the second appeal. The connectedmiscellaneous petitions are also dismissed.