Safedar Ali vs Siddappa Laxmappa

B.V. Nagarathna, J.—1. Though the appeal is listed for admission, with the consent of learned counsel on both sides, it is heard finally.

Plaintiff has preferred this second appeal, assailing judgment and decree dated 28.08.2012 passed in R.A. No. 15/2011 by Senior Civil Judge, Hungund, by which, judgment and decree passed by Additional Civil Judge and J.M.F.C., Hungund, in O.S. No. 197/2004 dated 03.01.2011, has been confirmed.

For the sake of convenience, the parties shall be referred to, in terms of their status before the trial Court.

Appellant - plaintiff filed the suit seeking specific performance of agreement to sell dated 05.11.1997 executed by defendant with regard to suit property or in the alternative for refund of earnest money of Rs. 30,000/- with damages of Rs. 5,000/-.

It is the case of plaintiff that defendant is the owner of suit property bearing R.S. No. 32/1 totally measuring 7 acres 29 guntas situated at Ilkal in Hungund taluk. Defendant had converted the said agricultural land for non-agricultural purposes vide order of Deputy Commissioner, Bagalkot, dated 23.03.1999. Defendant advertised the sale of plots, which he had made in the name of ''Guru Estate'' to the general public. Plaintiff intended to purchase two sites, namely site No. 198 and 199 for Rs. 15,000/-each. Plaintiff and defendant entered into an agreement on 05.11.1997. Plaintiff paid a sum of Rs. 3,000/- as part consideration amount for each site and remaining amount was to be paid on monthly instalment of Rs. 600/- per site.

It was further agreed that on completion of payment of all instalments, defendant would execute sale deed in favour of plaintiff According to plaintiff, entire sale consideration was paid. Plaintiff was ready and willing to perform his part of contract, but the defendant did not come forward to register the sale deed in his name. Consequently, plaintiff got issued legal notice dated 17.08.2004 calling upon defendant to execute the sale deed, but defendant neither replied to the notice nor executed sale deed in favour of plaintiff Therefore, plaintiff filed the suit seeking aforesaid reliefs.

On receipt of suit summons and Court notices, defendant appeared and filed his written statement denying the averments made in plaint. He, however, admitted that he was the owner of property bearing Sy. No. 32/1 measuring 7 acres 29 guntas. He further admitted that his Agency was called as ''Guru Estate'', and he had converted the said land for non-agricultural purposes and made sites and sold it to the general public. Defendant contended that there was an agreement with plaintiff, but the latter did not perform his part of contract inspite of requesting him to get the sale deed registered in his name. He did not take any interest. Defendant denied that plaintiff had requested him to execute the sale deed. He contended that suit was barred by the law of Limitation. Therefore, he sought for dismissal of suit. Based on the aforesaid pleadings, trial Court framed the following issues and additional issues :

"1. Whether the plaintiff proves that he was always ready and willing to perform his part of contract?

Whether the plaintiff proves that the defendant has failed to perform his part of contract?

Whether the plaintiff is entitled for the relief sought by him?

Additional Issues:

Whether this court has jurisdiction to try this suit?

Whether this court has pecuniary jurisdiction as on the date of filing of this suit?

Whether this suit is hit by Limitation or barred by time?"

In support of his case, plaintiff examined himself as P.W.1 and another witness as P.W.2. He produced four documents, which were marked as Exs.P-1 to 4. Defendant examined himself as D.W.2 and another witness was examined as D.W.1. He produced three documents, which were marked as Exs.D-1 to D-3(a). On the basis of said evidence, trial Court answered issues No. 1 to 3 in negative and additional issues No. 1 to 3 in affirmative and dismissed the suit by judgment and decree dated 03.01.2011.

Being aggrieved by the judgment of trial Court, plaintiff preferred R.A. No. 15/2011 before the First Appellate Court, which, on hearing learned counsel for parties framed the following points for its consideration :

"1. Whether the appellant/plaintiff proves that, defendant/respondent is not ready and willing to perform his part of contract?

Whether appellant/plaintiff proves that, framing of additional issue No. 3 in respect of Limitation is illegal and contrary to law?

What order?"

It answered points No. 1 and 2 in the negative and dismissed the appeal by confirming the judgment and decree of trial Court.

Being aggrieved by the judgment of First Appellate Court, plaintiff has preferred this second appeal.

I have heard learned counsel for appellant and learned counsel for respondent.

It is contended on behalf of appellant that the courts below were not right in dismissing the suit of plaintiff He contended that defendant had admitted that plaintiff and defendant had entered into an agreement to sell dated 05.11.1997. That the entire sale consideration had been remitted by plaintiff in respect of two sites, which had to be purchased by plaintiff from defendant. Plaintiff made several requests to defendant to come forward and execute a regular sale deed in favour of plaintiff But, defendant did not perform his part of contract. Ultimately, plaintiff got legal notice dated 17.08.2004 issued to defendant. Defendant did not reply to said notice. Having no other remedy, plaintiff was constrained to file the suit on 22.09.2004. Trial Court has held that suit was barred by Limitation and that plaintiff was not entitled to the relief of specific performance. Even the alternative remedy of refund of the amount paid by plaintiff was not granted. He contended that a sum of Rs. 15,000/- was the sale consideration in respect of two sites to be purchased by plaintiff and the entire sale consideration was remitted by plaintiff to defendant in terms of the agreement. He contended that even if a decree for specific performance was not granted, the alternative relief atleast could have been granted by trial Court instead of dismissal of suit on the premise that it is barred by Limitation. He contended that First Appellate Court was also not right in confirming the judgment and decree of trial Court. That substantial questions of law would arise in the appeal. Therefore, appeal may be admitted for a detailed hearing.

Per contra, learned counsel for respondent supporting judgment and decree of Courts below contended that no doubt there was an agreement between plaintiff and defendant dated 05.11.1997. In fact, plaintiff had remitted entire sale consideration in respect of two sites bearing Nos. 198 and 199, to be purchased by him. But for reasons best known to plaintiff, he did not come forward and request the defendant to execute a sale deed. Several times defendant enquired from plaintiff about the execution of sale deed, but plaintiff had not shown any interest at all. Ultimately plaintiff requested defendant for refund of the amount and this is evidenced by the endorsement made in Ex. D-3 at Ex. D-3(a). Though the trial Court and First Appellate Court was right in dismissing the suit of plaintiff, on the ground that it was hit by the law of Limitation, as the agreement to sell is dated 05.11.1997, sale deed was to be executed, on the lapse of 20 months from that day, after the receipt of entire sale consideration. Plaintiff did not take any steps immediately on the lapse of 20 months, instead only in September 2004 suit was filed. Under Article 54 of Limitation Act, the suit is belated. Therefore, trial Court and First Appellate Court were right in not granting any relief to plaintiff That the judgment and decree of Courts below would not call for any interference. No substantial question of law would arise in the appeal. He, therefore, submitted that appeal may be dismissed in limine.

Having heard learned counsel for parties and on perusal of the material on record, I am of the considered view that the appeal would have to be admitted on the following substantial questions of law :

"1. Whether plaintiff was entitled to a decree of specific performance of agreement dated 05.11.1997?

Whether plaintiff was entitled to the alternative relief?"

From the detailed narration of facts, it is apparent that there was indeed an agreement to sell site Nos. 198 and 199 formed in R.S. No. 32/1 by the defendant for a valuable consideration of Rs. 15,000/- for each site. The agreement is dated 05.11.1997. For 20 months from the date of agreement plaintiff had to tender Rs. 600/- per month per site, as the balance sale consideration. It has also been established that balance sale consideration was tendered by plaintiff But the fact that is established is that plaintiff remained silent till 17.08.2004. Only on that date legal notice was issued to defendant to execute the sale deed. The period of 20 months from 05.11.1997 would have come to an end in July 1999. Plaintiff has allowed the time to lapse from the year 1999 till 2004 when the legal notice was issued on 17.08.2004 and subsequently suit was instituted on 22.09.2004.

Having regard to the above facts, on the basis of Article 54 of the Limitation Act, trial Court, held that suit filed was hit by the said Article as three years had lapsed from the date fixed for performance of contract. Even if it is considered that there was no time period fixed, plaintiff had notice of performance being refused by defendant. It is on that basis that trial Court and First Appellate Court came to a conclusion that the suit itself was barred, and therefore neither decree of specific performance nor the alternative relief could have been granted to plaintiff But, on perusal of a copy of Ex. D-3, which has been submitted by learned counsel for respondent during the course of submission, it is noted that plaintiff has endorsed, on that document, that he consents for defendant to sell plot Nos. 198 and 199, which he had intended to purchase. The said endorsement would clearly indicate that plaintiff was no longer interested in purchasing said plots.

In that view of the matter, relief of specific performance of contract sought by plaintiff in the year 2004 could not have been granted as the said endorsement implies that plaintiff had resiled from the agreement dated 05.11.1997. He was not ready and willing to purchase the two sites. That endorsement is made on 26.04.2003. The said date can be taken into consideration for the purpose of commencement of cause of action inasmuch as even if the plaintiff is not entitled to relief of specific performance, the same could be considered for the purpose of alternative relief. In view of the endorsement categorically made by plaintiff, at Ex. D-3(a), it is held that plaintiff was not entitled to specific performance of agreement to sell dated 05.11.1997. For reasons best known to plaintiff, he was not interested in purchasing said sites. Accordingly, substantial question of law No. 1 is answered by holding that plaintiff is not entitled to the relief of specific performance of agreement dated 05.11.1997.

The next substantial question of law is as to whether plaintiff is entitled to the alternative relief. For that purpose, once again reliance has to be placed on Ex. D-3(a), endorsement dated 26.04.2003, wherein plaintiff has categorically declined to buy sites. Therefore, suit filed on 22.09.2004 was not barred by law of Limitation.

Insofar as alternative relief is concerned, as per Section 22 of Specific Relief Act, 1963, a specific prayer was made by plaintiff in the suit itself for refund of sale consideration of Rs. 30,000/- paid in respect of two sites. Trial Court and First Appellate Court could not have declined to grant alternative relief to plaintiff.

Having regard to the fact that plaintiff was entitled to the said relief, since the year 2003, I am of the considered view that in addition to the said amount being returned, plaintiff would also be entitled to interest thereon at the rate of 10% p.a.

Of course, learned counsel for respondent has submitted that in the first place plaintiff could have straight away requested for refund of money, which would have been done by defendant. Secondly, although defendant offered to refund sale consideration, for reasons best known to plaintiff, he did not receive it. Therefore, he submitted that plaintiff should not be awarded any interest. But, as I have already stated that delay in actual refund of sale consideration would entitle the plaintiff to interest. Therefore, substantial question of law No. 2 is answered in favour of appellant plaintiff by directing defendant to refund the entire sale consideration of Rs. 30,000/- to plaintiff with interest at the rate of 10% p.a. from 26.04.2003 i.e., the date of endorsement made by plaintiff at Ex. D-3(a) till realisation. In the result, appeal is allowed in part by modifying the judgment and decree of Courts below.

Parties to bear their respective costs.