Alamelumangai vs Smt A. Krishnaveni

R.S. Ramanathan, J.—The unsuccessful Plaintiff is the Appellant herein.

The Plaintiff filed the suit for specific performance of an agreement of sale dated 03.01.1989. The case of the Plaintiff is that the Defendant

agreed to sell the property to the Plaintiff for a consideration of Rs. 62,000/- and the agreement of sale was entered into between the parties on

03.01.1989 and a sum of Rs. 46,500/- was paid on that date. As per the agreement, the sale has to be executed on or before 11.02.1989. But

thereafter, the period was extended upto 16.09.1989 and an endorsement was also made on the reverse side of the agreement of sale and the

Defendant also agreed to make good the deficit to the Plaintiff if it is found that the property agreed to be sold is lesser in extent and on that date of

agreement itself, possession was handed over to the Plaintiff and on 15.09.1989, the Plaintiff sent a telegram to the Defendant calling upon her to

execute the sale deed after the receipt of the balance sale consideration. The Defendant sent a reply containing false allegations. On 16.09.1989,

the Plaintiff waited in the Sub Registrar Office, Periyakulam, expecting the Defendant to come and execute the sale deed. But the Defendant did

not come and therefore, she filed an objection petition before the Sub Registrar not to register any sale deed in respect of the suit property.

Thereafter, the Defendant sent a notice dated 03.10.1989, containing false allegations and as the Defendant failed to execute the sale deed as per

the agreement of sale, the suit was filed for specific performance.

The Defendant contested the suit stating that she agreed to sell the property for the purpose of paying some other decree amount, as the decree

holder took steps to bring the property for a sale. Originally, she agreed to sell the property to one V.S. Rajendiran, and that person failed to pay

the consideration in time and the Defendant agreed to sell the property to the Plaintiff and the property agreed to be sold was 12 cents of land and

possession was handed over to the Plaintiff and the Plaintiff paid a sum of Rs. 46,500/- and that was mentioned in the agreement itself and at the

request of the Plaintiff, the time was extended till 16.09.1989. Even then, the Plaintiff was not able to mobilize funds. The Defendant also denied

the allegations that the Plaintiff was present before the Sub Registrar Officer on 16.09.1989. According to the Defendant she was present in the

Sub Registrar Officer and the Plaintiff did not appear on that date and the Plaintiff did not have any means to pay the balance amount. Therefore,

the Plaintiff was not ready and willing to perform her part of the contract and the Plaintiff is also guilty of laches. Therefore, she is not entitled to the

relief prayed for.

The Trial Court held that the Plaintiff was not ready and willing to perform her part of the contract. Therefore, she is not entitled to the

discretionary relief of specific performance and hence, dismissed the suit. The First Appellate Court also concurred with the findings of the Trial

Court and the First Appellate Court independently appraised the evidence and held that the Plaintiff is not entitled to the relief and dismissed the

appeal. Aggrieved against the same, this Second Appeal is filed.

The Second Appeal is admitted on the following substantial questions of law:

i) Whether the Plaintiff is not entitled to the benefit of Section 16(c) of the Specific Relief Act?

ii) Is not the findings of the Courts below regarding willingness and readiness on the part of the Plaintiff/Appellant is vitiated even after considering

Ex.A12?

iii) Is not the findings of the Courts below is perverse for not having considered the deposit made by the Appellant, the balance sale consideration

in to the Court, even though there was no such direction given by the Courts below?

iv) Whether the Courts below are right in dismissing the suit, when time in not the essence of the contract in the present case?

Mr. V. Radhakrishnan, the Learned Senior Counsel appearing for the Appellant/Plaintiff submitted that the time was not the essence of the

contract between the parties. It is also admitted that the time was extended by the parties and therefore, the Courts below erred in holding that

time was the essence of the contract and therefore, the Plaintiff is not entitled to the relief prayed for. The Learned Senior Counsel also submitted

that there is no delay or laches on the part of the Plaintiff and the suit was filed on 14.09.1992 before the expiry of three years from the date fixed

for performance of the contract. Therefore, the suit cannot be dismissed on the ground that it was filed on the last date of the limitation. In support

of his contention, Learned Senior Counsel relied upon the reported in Madamsetty Satyanarayana Vs. G. Yellogi Rao and Others, (2000) M.L.J.

(Supp) 632 in the matter of ( Mrs. Leela Raghavan and Ors. v. Zacheria and Ors.) K.M. Rajendran Vs. Arul Prakasam and another, and AIR

(1988) Mad 84 in the matter of (N.B. Namazi v. Central Chinmaya Mission Trust).

The Learned Senior Counsel further submitted that u/s 16(c) of the Specific Relief Act, the Plaintiff has to prove that she was always ready and

willing to perform her part of the contract and in this case the Plaintiff has proved her means by giving evidence that she borrowed a sum of Rs.

25,000/- from one V.S. Rajendiran, for paying the balance sale consideration and admittedly, the major portion of the sale consideration was paid

on the date of the agreement of sale. Therefore, it cannot be contended that the Plaintiff was not having the money to complete the sale and having

regard to the conduct of the Plaintiff, it has been proved by the Plaintiff that she was always willing and ready to perform her part of the contract.

In support of his contention, the Learned Senior Counsel also relied upon the judgments reported in the matter of Mst. Sugani Vs. Rameshwar Das

and Another, in the matter of Syed Dastagir Vs. T.R. Gopalakrishnasetty, in the matter of Aniglase Yohannan Vs. Ramlatha and Others, and in the

matter of Rameshwar Prasad v. Basanti Lal (2008) SCC 676 in the matter of (Rameshwar Prasad Vs. Basanti Lal)

The Learned Senior Counsel further submitted that the Defendant has also admitted in evidence that she is willing to execute the document, if

present market price is paid and the Plaintiff is willing to pay the present market price. The Hon''ble Supreme Court also held that the price

escalation cannot be a ground to deny the relief of specific performance and the Plaintiff is willing to pay the enhanced price. But without

considering the same, the Courts below dismissed the suit. The Learned Senior Counsel also relied upon the judgments reported in the matter of P.

D''Souza Vs. Shondrilo Naidu, in the matter of Jai Narain Parasrampuria (Dead) and Others Vs. Pushpa Devi Saraf and Others, and in the matter

of Nirmala Anand Vs. Advent Corporation (P) Ltd. and Others, in support of his contention.

Therefore, the Learned Senior Counsel submitted that having regard to the fact that the suit was filed within the period of limitation and major

portion of the sale consideration was paid on the date of agreement of sale and the Plaintiff has also proved her means to pay the balance amount

and is willing to pay the enhanced consideration, the Courts below ought to have decreed the suit, but erred in dismissing the suit.

On the other hand, Mr. A. Arumugam, the learned Counsel appearing for the Respondent submitted that the conduct of the Plaintiff would dis-

entitle her to the relief of specific performance and it has been demonstrated in evidence that the Plaintiff was not ready and willing to perform her

part of the contract. Hence, the Courts below had righty refused to exercise the discretionary relief of specific performance and both the Courts

below have concurrently held that the Plaintiff was not ready and willing to perform her part of the contract and therefore, the same findings cannot

be interfered with in the Second Appeal.

The learned Counsel appearing for the Respondent further submitted that the Respondent/Defendant sent a notice dated 15.09.1989, Ex.A6,

informing the Plaintiff that the agreement of sale entered into between the parties was canceled and even thereafter, the Plaintiff did not file the suit

for specific performance and the suit was filed only on 14.09.1992 viz., three years after when the Defendant repudiated the agreement of sale.

This conduct on the part of the Plaintiff would be sufficient to deny the discretionary relief of specific performance in favour of the Plaintiff. It was

also contended by the learned Counsel that the Plaintiff is also not entitled to the discretionary relief of specific performance, as she has not come

to the Court with clean hands. Admittedly, the Plaintiff is having the possession of the property from the date of agreement of sale and in the plaint,

she has stated that the Defendant has agreed to make good the extent if it is found less and if, according to the Plaintiff, the property in her

possession is less than 12 cents of the property agreed to be sold, she would have mentioned the same in her notice or in the re-joinder notice. But

in those two notices, viz., Exs.A5 and A7, nothing has been stated about the extent and for the purpose of justifying the delay, it has been stated in

the plaint that the Defendant agreed to measure the property and she has not measured the property and that was the reason for not completing the

sale transaction. It is his further submission that it is not the case of the Plaintiff that she measured the property and found that the property is less

than 12 cents. Therefore, the story now put forward by the Plaintiff is that the Defendant agreed to measure the property and executed the sale

deed would expose the Plaintiff''s dirty game of causing loss to the Defendant and the Plaintiff''s taking advantage of her possession of the suit

property, did not evince any interest to complete the sale transaction within a stipulated time. Therefore, the Plaintiff is not entitled to the

discretionary relief of specific performance.

The learned Counsel further submitted that the Plaintiff did not have the means to pay the balance sale consideration and though it was stated

by the Plaintiff during evidence that she borrowed money from one Rajendiran, for paying the balance consideration, the document Ex.A3, the

promissory note alleged to have been executed by the Plaintiff in favour of Rajendiran, is only a self serving document and the Plaintiff has not

examined the person Mr. Rajendiran, who according to her gave the amount and in the absence of such evidence, it can be also presumed that the

Plaintiff did not have the means to pay the amount. He also submitted that having regard to the fact that the Defendant repudiated the contract in

her notice dated 15.09.1989, there is no need for the Plaintiff to wait till last date and if really, the Plaintiff was ready and willing to perform her

part of the contract, she would not have filed the suit immediately on receipt of the notice issued by the Defendant. The fact that the Plaintiff filed

the suit on the last date of limitation would make it clear that the Plaintiff was not having the means to pay the balance amount. The learned Counsel

also relied upon the judgments reported in the matter of Inderchand Jain (D) through L.Rs. v. Motilal (D) through L.Rs. (2009) 5. C.T.C. 365 in

the matter of Indravanthi v. Kamala (2000) 3 M.L.J. 106 in the matter of M. Ranganathan v. M. Thulasi Naicker (Deceased) and Ors. (2005) 1

M.L.J. 374 (2008) 5. C.T.C. 428 and in the matter of Vasantha Ammal v. Babu Chettiar and Ors. (2009) 1 M.L.J. 457 in support of his

contention.

In this case, it is admitted that the agreement of sale was executed on 03.01.1989 and as per the said agreement, the sale has to be completed

on or before 11.02.1989 and on 09.02.1989, the parties agreed to extend time till 16.09.1989. Therefore, from the admitted facts, it is made clear

that the parties agreed to extend the time by six months and having regard to the nature of the property viz., immovable property, it can be safely

presumed that the parties never intended to have time as essence of the contract. But the crucial question that has to be decided in the Second

Appeal is whether the Plaintiff was ready and willing to perform her part of the contract.

It is admitted that in Ex.A6, the Defendant categorically stated that the agreement of sale dated 03.01.1989 was canceled. Therefore, there is

no reason for the Plaintiff to keep quiet and thereafter, the Plaintiff cannot be heard to say that she was expecting the Defendant to come and

execute the sale deed after measuring the property of the Plaintiff, when the Defendant has repudiated the agreement of sale by sending a reply

notice. If the Plaintiff is ever willing and ready to perform her part of the contract, she ought to have filed the suit immediately.

Admittedly, the Plaintiff did not take any action for nearly three years and she filed the suit only two days prior to the expiry of limitation. In

similar circumstances, this Court in the judgments reported in the matter of Sreeranga Nachiar and Ors. v. Athi Chettiar (2008) 3 L.W. 205 and in

the matter of Pushparani Shanmughasundaram v. Pauline Manonmani James (1993) I L.R. 219 and in the matter of K.S. Vidayanadam v.

Vairavan AIR (1997) S.C.C. 1751 declined to grant the relief of specific performance. The various judgments relied upon by the learned Senior

Counsel for the Appellant has laid down the law having regard to the facts of those cases. As a matter of fact, in the judgment reported in (2009)

C.T.C. 365 (supra) the Hon''ble Supreme Court has interpreted Section 16(c) of the Specific Relief Act, which reads as follows:

Section 16(c) of the Specific Relief Act, 1963 mandates that the discretionary relief of specific performance of the contract can be granted only in

the event the Plaintiff not only makes necessary pleadings but also establishes that he had all along been ready and willing to perform his part of

contract. Such readiness and willingness on the part of the Plaintiff is not confined only to the stage of filing of the plaint but also at the subsequent

stage viz., at the hearing. It has been so held in Umabai and Another Vs. Nilkanth Dhondiba Chavan (Dead) by Lrs. and Another, in the following

term:

It is now well settled that the conduct of the parties, with a view to arrive at a finding as to whether the Plaintiff-Respondents were all along and

still are ready and willing to perform their part of contract as mandatorily required u/s 16(c) of the Specific Relief Act must be determined having

regard to the entire attending circumstances. A bare averment in the plaint or a statement made in the examination-in-chief would not suffice. The

conduct of the Plaintiff-Respondents must be judged having regard to the entirety of the pleadings as also the evidences brought on records.

In terms of Forms 47 and 48 appended to Appendix A of the Code of Civil Procedure, the Plaintiff must plead that "" he has been and still is

ready and willing specifically to perform the agreement on his part of which the Defendant has had notice"" or "" the Plaintiff is still ready and willing

to pay the purchase money of the said property to the Defendant"". The offer of the Plaintiff in the instant case is a conditional one and thus, does

not fulfill the requirement of law.

Yet again in Sita Ram and Others Vs. Radhey Shyam, , while referring to Ardeshir H. Mam v. Flora Sassoon AIR 1928 PC 208 this Court

opined as under:

the Privy council observed that where the injured party sued at law for a breach, going to the root of the contract, he thereby elected to treat the

contract as at an end himself and as discharged from the obligations. No further performance by him was either contemplated or had to be

tendered. In a suit for Specific Performance on the other had, he treated and was required by the Court to treat the contract as still subsisting. He

had in that suit to allege, and if the fact was traversed, he was required to prove a continuous readiness and willingness from the date of the

contract to the time of the hearing, to perform the contract on his part.

For the purpose of obtaining a decree for specific performance of contract, the Court must arrive at a conclusion that the Plaintiff not only pleaded

but also established his readiness and willingness to perform his part of the contract throughout. Exercising the discretionary jurisdiction one way or

the other having regard to Section 20(2)(b) would depend thereupon arriving at a finding of such fact

In the judgment reported in G. Chelliah Nadar (died) and Others Vs. Periasami Nadar and Others, the Division Bench of our High Court has

held that there should not be any unexplained delay on the part of the Plaintiff in seeking the remedy of relief of specific performance. In the cases

reported in Umabai and Another Vs. Nilkanth Dhondiba Chavan (Dead) by Lrs. and Another, the Hon''ble Supreme Court has observed as

follows:

It is now well settled that the conduct of the parties, with a view to arrive at a finding as to whether the Plaintiff-Respondents were all along and

still are ready and willing to perform their part of contract as is mandatorily required u/s 16(c) of the Specific Relief Act must be determined having

regard to the entire attending circumstances. A bare averment in the plaint or a statement made in the examination-in-chief would not suffice. The

conduct of the Plaintiff-Respondents must be judged having regard to the entirety of the pleadings as also the evidences brought on records....

Inference of readiness and willingness could be drawn by the conduct of the Plaintiffs, the circumstances in a particular case in other words to

be gathered from the totality of the circumstances.

In the judgment reported in Veerayee Ammal Vs. Seeni Ammal, it was observed as follows:

When concededly, the time was not of the essence of the contract, the Appellant -Plaintiff was required to approach the Court of law within a

reasonable time. A constitution Bench of this Hon''ble Court in Chand Rani v. Kamal Rani held that in case of sale of immovable property there is

no presumption as to time being of the essence of the contract. Even if it not of the essence of the contract, the Court may infer that it is to be

performed in a reasonable time if the conditions are (i) from the express terms of the contract; (ii) from the nature of the property; and (iii) from the

surrounding circumstances, for example, the object of making the contract. For the purposes of granting relief, the reasonable time has to be

ascertained from all the fact and circumstance of the case.

It was further more observed:

...13. The word "" reasonable"" has in law prima facie meaning of reasonable in regard to those circumstances of which the person concerned is

called upon to act reasonably knows or ought to know as to what was reasonable. It may be unreasonable to give an extent definition of the word

reasonable "". The reason varies in its conclusion according to idiosyncrasy of the individual and the time and circumstances in which he thinks.

The dictionary meaning of the "" reasonable time"", is to be so much time as is necessary, under the circumstances, to do conveniently what the

contract or duty requires should be done in a particular case. In other words, it means, as soon as circumstances permit. In P. Ramanatha Aiyar''s

The Law Lexicon it is defined to mean:

A reasonable time, looking at all the circumstances of the case; a reasonable time under ordinary circumstances; as soon as circumstances will

permit; so much time as is necessary under the circumstances, conveniently to do what the contract requires should be done; some more

protracted space than ''directly''; such length of time as may fairly, and properly, and reasonably be allowed or required, having regard to the

nature of the act or duty and to the attending circumstances; all these convey more or less the same idea.

Further, in the judgment reported in the matter of Mohammedia Coop. Building Society Ltd. Vs. Lakshmi S. Coop. Building Society Ltd. and

Others, the Hon''ble Supreme Court has held as follows:

The grant of a decree for specific performance of contract is a discretionary relief. There cannot be any doubt whatsoever that the discretion has to

be exercised judiciously and not arbitrarily. But for the said purpose, the conduct of the Plaintiff plays an important role. The Courts ordinarily

would not grant any relief in favour of the person who approaches the Court with a pair of dirty hands.

In the judgment reported in the matter of Mrs. Sanjana M. Wig Vs. Hindustan Petro Corporation Ltd., the Hon''ble Supreme Court has held

as follows:

...in regard to exercise of the discretionary jurisdiction, this Court held that the same depends upon the facts and circumstances of each case

wherefore no hard and fast rule can be laid down

In the judgment reported in matter of K.S. Vidyanadam and Others Vs. Vairavan, the Hon''ble Supreme Court has held as follows:

The learned Counsel for the Plaintiff says that when the parties entered into the contract, they knew that prices are rising, hence, he says, rise in

prices cannot be a ground for denying the specific performance. May be, the parties knew of the said circumstance but they have also specified six

months as the period within which the transaction should be completed. The said time-limit may not amount to making time the essence of the

contract but it must yet have some meaning. Not for nothing could such time limit would have been prescribed. Can it be stated as a rule of law or

rule of prudence that where time is not made the essence of the contract, all stipulations of time provided in the contract have no significance or

meaning or that they are as good as non-existent? All this only means that while exercising its discretion, that Court should also bear in mind that

when the parties prescribes certain time-limit for taking steps by one or the other party, it must have some significance and that the said time limit

cannot be ignored altogether on the ground that time has not been made the essence of the contract ( relating to the immovable properties).

...In the case before us, it is not mere delay. It is a case of total inaction on the part of the Plaintiff for 2 1/2 years in clear violation of the terms of

the agreement which required him to pay the balance, purchase the stamp papers and then ask for execution of sale deed within six months.

Further, the delay is coupled with substantial rise in prices - according to the Defendants, three times - between the date of agreement and the date

of suit notice. The delay has brought about a situation where it would be inequitable to give the relief of specific performance to the Plaintiff.

Therefore, from the above judgments, it has been made clear that the party who has not taken any steps to perform his part of the contract

immediately on receipt of notice issued by the Defendant repudiating the agreement of sale and kept quiet till the expiry of limitation is not entitled

to the discretionary relief of specific performance.

As a matter of fact in the judgment reported in (2002) 8 S.C.C. 146 S.C.(supra) the Hon''ble Supreme Court has held as follows:

Grant of decree of specific performance lies in the discretion of the Court and it is also well settled that it is not always necessary to grant specific

performance simply for the reason that it is legal to do so. However, the Court in its discretion can impose any reasonable condition including

payment of an additional amount by one party to the other while granting or refusing decree of specific performance. Whether the purchaser shall

be directed to pay an additional amount to the seller or converse would depend upon the facts and circumstances of the case. Ordinarily, the

Plaintiff is not to be denied the relief of specific performance only on account of the phenomenal increase of price during the pendency of litigation.

That may be, in a given case, one of the considerations besides many others to be taken into account for refusing the decree of specific

performance. As a general rule, it cannot be held that ordinarily the Plaintiff cannot be allowed to have, for her alone, the entire benefit of

phenomenal increase of the value of the property during the pendency of the litigation. While balancing the equities, one of the considerations to be

kept in view is as to who is the defaulting party. It is also to be borne in mind whether a party is trying to take undue advantage over the other as

also the hardship that may be cause to the Defendant by directing specific performance. There may be other circumstances on which parties may

not have any control. The totality of the circumstances is required to be seen.

As held by the Hon''ble Supreme Court, the Court should not help the defaulting party and in this case, as rightly pointed out by the learned

Counsel for the Respondent the Plaintiff is having possession with her and she is enjoying the property and she has not filed the suit immediately on

receipt of the notice issued by the Defendant repudiating the agreement of sale and all these would obviously prove that the Plaintiff was not ready

and willing to perform her part of the contract.

Though the Defendant has stated in evidence that she was prepared to execute the sale deed, if the present market price is paid to her that

cannot be taken advantage of by the Plaintiff to grant the relief of specific performance. No doubt, the Hon''ble Supreme Court has held that the

escalation of price cannot be a reason for refusing the relief of specific performance and in the judgment reported in Nirmala Anand Vs. Advent

Corporation (P) Ltd. and Others, , the Hon''ble Supreme Court has observed that whether the purchaser shall be directed to pay an additional

amount to the seller or converse would depend upon the facts of the case and while dealing with such case, the Court has to consider, who is a

defaulting party and when the Plaintiff is not the defaulting party, he is entitled to the relief of specific performance. But in this case, it can be stated

that the Plaintiff is the defaulting party.

As stated supra, even after the receipt of notice from the Defendant, repudiating the agreement of sale, the Plaintiff did not take any action and

kept quiet for nearly three years and as held by the Hon''ble Supreme Court in a suit for specific performance, the conduct of the parties from the

date of agreement of sale till the conclusion of the trial has to be taken into consideration to find out whether the party was ready and willing to

perform his part of the contract. In this case, the conduct of the Plaintiff would make it clear that she was not ready and willing to perform her part

of the contract. In the judgment reported in the matter of K. Jayakumar Vs. Robert, John Peter, Jamuna, Santhi, Amalraj, Geetha and Nedila, it

has been held the purchaser should be ready either with funds or he should be possessed of the capacity to generate funds within time stipulated.

He should also have the necessary willingness of mind to complete the sale on the inception. Therefore, the party''s readiness and willingness willy

or nilly would mean the capacity to raise or mobilize the fund and their mandatory attitude to perform their part of the contract. In this case, it is

admitted by the Plaintiff that she borrowed a sum of Rs. 25,000/- on 12.09.1989 from one Rajendiran. As rightly held by the Courts below, the

Ex.A3, is a self serving promissory note produced by the Plaintiff, but no proof was made available by the Plaintiff to prove that she was having

that money. On the other hand, the evidence of the Plaintiff that she borrowed money would also make it clear that till 12.02.1989, she did not

have money to pay the balance sale consideration. Even assuming that she got money on 12.09.1989, she would have proved her willingness to

perform her part of the contract by filing the suit immediately on the receipt of the reply notice issued by the Defendant. Therefore, the conduct of

the Plaintiff in keeping quiet for nearly three years, after the receipt of the notice issued by the Defendant, repudiating the contract of sale would

prove that the Plaintiff was not ready and willing to perform her part of the contract. Hence, the Plaintiff is not entitled to the relief of specific

performance, as she was not ready and willing to perform her part of the contract and the substantial questions of law 1 and 2 are answered

against the Plaintiff.

When the substantial questions of law 1 and 2 was found against the Plaintiff, there is no need to give any finding regarding other substantial

questions of law viz., 3 and 4 and even those substantial questions of law are answered in favour of the Plaintiff, the Plaintiff cannot succeed as she

was not ready and willing to perform her part of the contract. Therefore, there is no merit in the Second Appeal and it is dismissed accordingly and

the judgment and decree of the Courts below are confirmed. No costs.