Joseph George v. Chacko Thomas — 1991 DIGILAW 455 (KER)

Judgment :- Manoharan. These appeals arise from the judgment and decree in O.S.No. 33 of 1985 on the file of the Court of the Subordinate Judge of Kottayam, a suit for specific enforcement of ExtA1 agreement. Appellants in AS. 472 of 1986 are defendants 4 and 5, and appellants in AS.1 of 1987 are defendants 1 to 3. 2. The facts for the purpose of these appeals can be summarised as follows:- Defendants 1 and 2 obtained 24 cents as per a settlement, out of which on 1-1-1982 they conveyed 19.509 cents on the north with a building to defendants 4 and 5 as per Ext.B1 sale deed and Ext. B15 release deed. They executed Ext.A1 agreement to sell the southern 4.491 cents with six shop rooms to the plaintiffs for a total consideration of Rs. 3,20,633/- out of which on the date of Ext. A1 Rs. 50,000/- was paid as advance; Rs. One lakh had to be paid on 30-6-1984; and sale deed had to be got executed on or before 15-9-1984 on payment of the balance consideration. There was stipulation in Ext. A1 to the effect, if on account of the default of the plaintiffs, the sale deed is not executed within the said date the amount paid as advance would be forfeited. ExtA1 also provided that the sale would be executed incorporating provision for the use of the corridor between the said rooms and also the stair case to go to the first floor. As per the stipulation in Ext. A1 Rs. One lakh was paid to defendants 1 and 2 on 30-6-1984. The plaintiffs alleged that, they were ready and willing to perform their part of the contract and that they sent a notice on 5-9-1984 expressing their readiness and willingness to take the sale deed as per the agreement. Defendants land 2 sent a telegram on 14-9-1984 intimating that they would be present at Changanacherry to execute the sale deed. According to the plaintiffs, though plaintiffs and defendants 1 and 2 were present at the Registry, defendants 1 and 2 said that they are not in a position to execute the sale deed since defendants 4 and 5 refused to remove the obstruction created by them in the corridor by putting up a shutter at the entrance. They also informed that they have already sent the original of Ext. They also informed that they have already sent the original of Ext. A-20 lawyer notice on 16-7-1984 to defendants 4 and 5 calling upon them to remove the obstruction and they agreed to execute the sale deed after removal of the said obstruction. Pursuant to the same, according to the plaintiffs, defendants 1 to 3 executed Ext. B-3 power of attorney in favour of the 3rd defendant, the father of the second defendant on 15-9-1984 itself authorising him to take appropriate steps and to execute the sale deed. The 3rd defendant as power of attorney instituted Ext. A-11 suit against defendants 4 and 5 for removal of the obstruction and for other reliefs. The plaintiffs alleged, while the suit was pending, defendants 1 to 3 colluded with defendants 4 and 5 and executed Exts. B6 to B-14 sale deeds in favour of defendants 4 and 5 in breach of Ext. A1, and later they compromised the suit. Therefore, the plaintiffs claimed they are entitled to specifically enforce Ext. A1. According to them since defendants 4 and 5 are not transferees for value without notice, they are entitled to have Ext. A-1 enforced against them also. 3. Defendants' 1 and 2 though admitted the execution of Ext.A1 agreement and receipt of the advance as well as the payment of Rs. One lakh on 30-6-1984, contended that plaintiffs were not willing and ready to have the sale deed executed on 15-9-1984. They also contended that Exts. B6 to B-14 sale deeds are supported by consideration and good faith. According to them defendants 4 and 5 did not have notice of Ext. A1. Defendants 4 and 5 contended that the breach was committed by the plaintiffs, and that Exts. B6 to B-14 sale deeds are supported by consideration and good faith. They maintained that they were not aware of Ext. A1 agreement. According to them Ext. A1 cannot be enforced against them and the reservation of the right to use the corridor is not enforceable in law. 4. The trial court found that the plaintiffs were ready and willing to perform their part of contract and the execution of the sale deed on 15-9-1984 was postponed to be executed after removal of the obstruction created by defendants 4 and 5; and defendants 4 and 5 are not transferees in good faith for consideration and without notice. 4. The trial court found that the plaintiffs were ready and willing to perform their part of contract and the execution of the sale deed on 15-9-1984 was postponed to be executed after removal of the obstruction created by defendants 4 and 5; and defendants 4 and 5 are not transferees in good faith for consideration and without notice. Therefore, the suit was decreed for specific performance. 5. On behalf of the appellant, it was contended that the fact that plaintiffs did not make the deposit within the time stipulated in the decree itself would show that they were not ready and willing to perform their part of the contract, and on that short ground the plaintiffs are liable to be not-suited. According to the defendants since plaintiffs are guilty of breach of contract, at their instance, Ext. A1 cannot be specifically enforced; according to them the agreement to execute the sale deed with the right to use the corridor and the staircase cannot be enforced against defendants 4 and 5. They maintained, the finding of the court that Exts. B6 to B14 are not supported by consideration and that defendants 4 and 5 are not aliens for value without notice is unsustainable. It was also contended that, plaintiffs are estopped from claiming to have the sale deed executed including the right of user of the corridor and the staircase. It was also contended on behalf of defendants 4 and 5 that defendants 1 to 3 on the one hand and the plaintiffs on the other have colluded to bring into existence Ext. A1 so as to defeat the right of these defendants. 6. The execution of Ext. A1 agreement, the receipt of advance and also the receipt of Rs. one lakh on 30-6-1984 are all admitted by defendants 1 to 3. If only Ext. A1 is specifically enforceable against defendants 1 and 2, the question as to the enforceability of the same against defendants 4 and 5 need arise for consideration. At the instance of one who is guilty of breach of contract specific enforcement is not possible. According to the plaintiffs it was the defendants 1 to 3 who committed breach of contract; and it is on that basis plaintiffs seek to enforce Ext. A1. At the instance of one who is guilty of breach of contract specific enforcement is not possible. According to the plaintiffs it was the defendants 1 to 3 who committed breach of contract; and it is on that basis plaintiffs seek to enforce Ext. A1. In the circumstance the first question to be considered would be whether the plaintiffs' case that defendants 1 to 3 committed breach of contract is true. As has noted the sale deed had to be got executed on or before 15-9-1984. As per S.16(c) of the Specific Relief Act, 1963 (for short 'the act) the plaintiffs have to aver readiness and willingness to perform their part of the contract. In paragraph 8 of the plaint the plaintiffs have made the necessary allegation as to the willingness and readiness to perform their part of the contract. According to the plaintiffs, they had issued Ext. A7 lawyer notice to defendants 1 and 2 intimating their readiness and willingness to get the sale deed executed. It is not disputed that defendants 1 and 2 sent a telegram to the plaintiffs intimating that they would be present for execution of the sale deed. It is also not in dispute that the plaintiffs and defendants 1 to 3 were present at the Sub Registry Office; but the execution of the sale deed did not take place. According to the plaintiffs, since defendants 4 and 5 who got Exts. B1 and B15 for the property situated on the north created an obstruction in the corridor by installing rolling shutters„ defendants 1 to 3 expressed their inability to execute the sale deed, and they agreed to execute the sale deed after getting the obstruction removed. According to the plaintiffs, pursuant to the same defendants land 2 executed Ext. B3 power of attorney in favour of the third defendant to take appropriate steps in that direction and to execute the sale deed. It is the case of the plaintiffs that defendants 1 to 3 told them that they have already sent Ext. A-20 lawyer notice on 16-7-1984 to defendants 4 and 5 to remove the obstruction and that Ext. A-20 copy of the lawyer notice was handed over to them. Of course defendants 4 and 5 denied to their having received Ext. A-20 notice. A-20 lawyer notice on 16-7-1984 to defendants 4 and 5 to remove the obstruction and that Ext. A-20 copy of the lawyer notice was handed over to them. Of course defendants 4 and 5 denied to their having received Ext. A-20 notice. Defendants 1 to 3 would maintain that, though the plaintiffs came to the Sub Registry Office, they left without getting the sale deed executed with ulterior motive. According to the defendants time being the essence of the contract inasmuch as the plaintiffs were not willing and ready to have the sale deed executed on 15-9-1984, they are guilty of breach of contract and consequently they are not entitled to specific performance. 7. Under S.55 of the Contract Act, time is not the essence of contract to sell immovable property and a stipulation in the contract that the document has to be executed within a period fixed in the contract need not make the stipulation as to time essence of contract. Default clause by itself also need not evidence the intention to make time the essence of the contract; time can be the essence of the contract if it is intended to be so and such intention can be evidenced either by express stipulations or by strong circumstance to displace the presumption that in a contract for sale of land time is not the essence of the contract. (The decision in Gomathinayagam Pillai v. Palaniswami Nadar (AIR 1967 SC 868). ExtA1 does not contain a stipulation which would compel an inference that the time is the essence of the contract. As noticed, it is the case of the plaintiffs that on 15-9-1984 the execution of the sale deed was postponed on mutual consent. Plaintiffs mainly relied onExt.B-3 in support of the said contention. Ext. B-3 is the power of attorney executed by defendants 1 and 2 in favour of the 3rd defendant on the same day viz. 15-9-1984. Ext. B3 authorises the 3rd defendant to institute suit on behalf of defendants land 2 with respect to 19.509 cents and other properties, and to execute document pursuant to the agreement to sell the six shop rooms. Reference in Ext. B3 to the agreement to sell evidently is Ext. Al. If as a matter of fact the plaintiffs were guilty of breach of contract and defendants 1 to 3 accepted the breach, the execution of Ext. Reference in Ext. B3 to the agreement to sell evidently is Ext. Al. If as a matter of fact the plaintiffs were guilty of breach of contract and defendants 1 to 3 accepted the breach, the execution of Ext. B3 on the same date authorising the 3rd defendant to execute the sale deed pursuant to the agreement is quite inconsistent. On the other hand, the execution of Ext. B3 unambiguously would bring out an intention to perform the contract even after 15-9-1984. Ext. B3 supports the case of the plain tiffs that defendants 1 to 3 agreed to take appropriate steps to remove the obstruction. As has noted defendants 1 and 2 undertook in Ext. A1 to execute the sale deed making necessary reservation to use the corridor and the stair case to go to the first floor of the six shop rooms. In the context of such a provision in Ext. A1 when defendants 4 and 5 installed a shutter at the entrance of the corridor, it is probable that defendants 1 to 3 agreed to postpone the execution of the sale deed to a date after getting the obstruction removed. Therefore, it cannot be said that plaintiffs committed breach of contract on 15-9-1984; the contract was alive for performance even after that date. 8. As has noticed the plaintiffs' case is, the breach was committed by defendants 1 to 3 on their executing Exts. B6 to B-14 sale deeds in favour of defendants 4 and 5 on 25-11-1985. But according to the defendants inasmuch as the plaintiffs did not deposit the balance sale consideration within off month of the judgment of the trial court, their claim that they were willing and ready to perform their part of the contract cannot be sustained. The judgment of the lower court directed defendants 1 and 2 to execute the sale deed in conjunction with defendants 4 and 5 in favour of the plaintiffs as per Ext. A1 agreement by receiving Rs. 1,70,633/- within a period of one month from the date of the judgment. The contention by the defendants is, within one month of the said judgment, no deposit having been made it cannot be said that the plaintiffs were willing and ready to perform their part of the contract. The basis of the said contention is clause (c) of S.16 of the Act. The contention by the defendants is, within one month of the said judgment, no deposit having been made it cannot be said that the plaintiffs were willing and ready to perform their part of the contract. The basis of the said contention is clause (c) of S.16 of the Act. According to the defendants inasmuch as the readiness to perform their part of contract being obligatory as per the said clause, failure to make the deposit within the time stipulated in the decree is the true demonstration of absence of willingness on the part of the plaintiffs to perform their part. Reliance was placed by the learned counsel on the decision in Nawal Kishore v. Kauleshwari Devi (AIR 1986 Patna 301). In that case there was a direction to deposit the balance consideration within a month of the judgment, which was not done. The court held, the fact that the plaintiffs failed to deposit the amount within the time mentioned in the judgment of the trial court would show that they were not willing to perform their part of the contract. O.XX R.12-A C.P.C. enjoins that the decree shall specify a period within which the balance purchase money is to be paid. According to the learned counsel for the defendants the direction to pay the balance consideration within a month of the judgment thus being as required under R.12-A of Order ;;C.P.C. non compliance of the same can only be interpreted to mean that the plaintiffs were not willing to perform their part of the contract. 9. It is necessary in this connection to note that the plaintiff in a suit for specific performance has to show readiness to perform his part of the contract till the date of the decree (Ardeshir v. Flora Sassoon (AIR 1928 P.C. 208). Explanation (i) to S.16(c) of the Act itself states that, it is not essential for the plaintiff to actually tender or deposit the money. All that is necessary is that the plaintiffs should show that they have capacity to make the payment. The defendants do not have a case that the plaintiffs did not have the capacity to raise the amount. Exts. A3 to A6, A-17 and A-18 would show that, the plaintiffs were capable of raising the balance consideration. All that is necessary is that the plaintiffs should show that they have capacity to make the payment. The defendants do not have a case that the plaintiffs did not have the capacity to raise the amount. Exts. A3 to A6, A-17 and A-18 would show that, the plaintiffs were capable of raising the balance consideration. But, as has noted the contention of the defendants is, once the court orders deposit within a specified time, failure to make the same would be proof that the plaintiffs were not willing to perform their part of the contract. On the other hand, according to the plaintiffs failure to deposit within the time stipulated need not be a circumstance in deciding whether the plaintiffs were willing to perform their part of contract. Having noted, the plaintiffs should be willing and ready to perform their part of the contract and the same should continue till the date of the decree, it becomes necessary, in the circumstance, to see as to what is the consequence of the failure to pay or deposit the consideration within the time specified in the decree. In this regard the character of the decree for specific performance and the jurisdiction of the court after passing of the decree is of crucial importance. S.28(1) of the Act in the context is relevant. The same reads: "28 (1) Where in any suit a decree for specific performance of a contract for the sale or lease of immovable property has been made and the purchaser or lessee does not, within the period allowed by the decree or such further period as the court may allow, pay the purchase money or other sum which the court has ordered him to pay, the vendor or lessor may apply in the same suit in which the decree is made, to have the contract rescinded and on such application the court may, by order, rescind the contract either so far as regards the party in default or altogether, as the justice of the case may require". S.28(1) of the Act enables the vendor to have the contract rescinded on the failure of the purchaser to make the deposit within the time fixed by the decree or such further period as the court may allow. S.28(1) of the Act enables the vendor to have the contract rescinded on the failure of the purchaser to make the deposit within the time fixed by the decree or such further period as the court may allow. Though S.28(1) of the Act is the modified form of S.35(c) of the Repealed Act, the new Section is different not merely in wording but in substance also. 10. The consequence of non compliance of the decree is to be found in S.28 of the Act. On the failure to deposit, the vendor can apply to rescind the contract. The decree cannot be annulled or modified in any other manner. In spite of the decree, when the condition in S.28 of the Act is satisfied, the contract can be rescinded. On such rescission of the contract the vendor would be absolved from the liability to perform the contract; he cannot independently of the procedure contemplated under S.28 of the Act absolve himself from satisfying decree. The fact that S.28 of the Act enables the court to extend time itself would imply that, mere failure to deposit need not result in the rescission of the con tract. In the decision in H.I. Trust v. Haridas Mundhra (AIR 1972 SC 1826) while considering the effect of a decree for specific performance and the jurisdiction of the court after the passing of the decree it is stated, The Specific Relief Act is not an exhaustive enactment, it does not consolidate the whole law on the subject and despite the passing of the decree in a suit for specific performance, the court retains the control and it was open to the court to entertain an application for rescission of the decree if it is shown that the plaintiff' positively refused' to complete the contract. It is pointed out that, a decree for specific performance is a decree in favour of both the plaintiff and the defendant in the suit and the same could be executed as per Order XXI Rule 32 C.P.C. Naturally, therefore, the decree was executable at the hands of the defendants also. In such circumstance it was open to the defendants to move under S.28 of the Act to get the contract rescinded or to take out execution as per Order XXI Rule 32 C.P.C. Neither was done by the defendants. In such circumstance it was open to the defendants to move under S.28 of the Act to get the contract rescinded or to take out execution as per Order XXI Rule 32 C.P.C. Neither was done by the defendants. The circumstances does not show that there was Skilful refusal by the plaintiffs to make the deposit. In the context of S.28 of the Act and also Order XXI Rule 32 C.P.C. it is not possible to hold that when already a decree for specific performance is passed mere failure to deposit the amount should nullify the decree. It is particularly so since as per S.28 of the Act, the court can extend the time for deposit. 11. Consistent with the nature of the decree for specific performance, in the matter of deposit within the stipulated time, courts used to make a liberal approach to enable performances. In the decision in Manika Gounder v. Samikanu (AIR 1967 Madras 397) a suit for specific performance was compromised and the decree stipulated that the plaintiff should deposit a sum of Rs. 800/- on or before 15-11-1962. Plaintiff therein filed an Execution Petition on 26-11-1962 for execution of the decree after depositing the balance consideration. The plaintiff also moved a petition for extension of time for payment of the said sum. It was held that the extension of time granted by the lower court was in order. In the decision in Amar Nath Jain v. Ram ParkashDhir (1987 (1) Punjab Law Reporter - Vol.91) in a decree for specific performance one month's time was granted for deposit of the consideration, an appeal was filed and the same was dismissed. No deposit was made within one month of the dismissal of even the Second Appeal. It was contended that, the agreement stood rescinded and thus the decree has become incapable of execution. The court held that since the court had power to extend the time and since the decree holder was allowed to make deposit, it could be presumed that the time was extended even though no application in that behalf was made. In the decision in P.S.S.S. Chettiar. P.S.S.S. Chettiar (AIR 1980 SC 512) it is held even ' at the stage of appeal before the Supreme Court the time to make deposit should be extended enabling the plaintiff to get advantage of the agreement to sell. In the decision in P.S.S.S. Chettiar. P.S.S.S. Chettiar (AIR 1980 SC 512) it is held even ' at the stage of appeal before the Supreme Court the time to make deposit should be extended enabling the plaintiff to get advantage of the agreement to sell. These decisions also show that the mere failure to deposit within the time mentioned in the decree cannot over throw the decree and free the judgment debtor from satisfying the decree. In the absence of wilful default the court will not rescind the decree. We are unable to agree with the contrary view in Nawal Kishore's case (AIR 1986 Patna 301). 12. It is thus clear that the contract is enforceable against defendants 1 to 3. Now the question that would arise is whether the contract is enforceable against defendants 4 and 5. As has already noted, defendants 1 and 2 executed Exts. B6 to B-14 sale deeds in favour of defendants 4 and 5. The lower court found that defendants 4 and 5 are not transferees for value and without notice. It is, on that finding, that the lower court allowed enforcement of Ext. A1 against them also. The said finding was attacked by the learned counsels for the defendants contending that, even if the agreement is specifically enforceable against defendants 4 and 5, the clause in Ext. A1 enjoining execution of the sale deed reserving the right to use the corridor and the stair case by the plaintiffs at any rate is not enforceable against defendants 4 and 5. 13. In agreement to sell though does not create an interest in land, it creates a personal obligation of a fiduciary character which can be enforced not only against the vendor but against a purchaser for consideration with notice and a volunteer. Ordinarily, a transferee of immovable property could obtain only whatever right his transferor had. The transferee cannot be in a better position than the transferor, but the obligation cannot be enforced against a transferee for consideration without notice of the obligation. S.19 of the Act among other things states that, specific performance of a contract can be enforced against the other party or any person claiming under him by a title arising subsequent to the contract except a transferee for the value who has paid his money in good faith and without notice of the original con tract. S.19 of the Act among other things states that, specific performance of a contract can be enforced against the other party or any person claiming under him by a title arising subsequent to the contract except a transferee for the value who has paid his money in good faith and without notice of the original con tract. Thus, it is clear that, an agreement to sell cannot be enforced against a subsequent transferee for consideration and without notice. Now, the contention of defendants is, defendants 4 and 5 are transferee for consideration without notice of Ext. A1. The first question that would arise for consideration is as to the burden of proof; the burden certainly is on defendants 4 and 5 to show that they are transferees for consideration without notice of Ext. A1. (Balakrishnan v. Kunjikrishnan -1981 KLT 463). Not only they have contended that they had no notice of Ext. A1, DW-3 has also sworn that he had no notice of Ext. A1. 14. Plaintiffs rely on certain circumstances to show that, defendants 4 and 5 had notice of Ext. A1. Admittedly defendants 4 and 5 are using the building in the northern portion of the whole 24 cents for their business; the six shop rooms are situated on the south of the said 24 cents facing the high way. On 15-9-1984 the sale deed could not be executed as defendants 4 and 5 had installed a rolling shutter in the corridor between the shop rooms; third defendant, the power of attorney of defendants 1 and 2 instituted Ext. A-11 suit for removal of the said obstruction and other reliefs. Ext. A-15 is the commissioner's report and sketch filed in Ext. A-11 suit. The sketch gives the location of the shops, the corridor and the building which defendants 4 and 5 obtained under Exts. B1 and B15. According to DW-1 the 3rd defendant, he told DW-6 that Ext. A1 is not in force as the plaintiffs have committed breach of contract. They maintained that, though Ext. A-11 suit was instituted by the 3rd defendant on behalf of defendants 1 and 2 for removal of the obstruction; during the pendency of the said suit, defendants 1 to 3 on the one hand and defendants 4 and 5 on the other colluded and executed Exts. B6 to B-14 sale deeds. They maintained that, though Ext. A-11 suit was instituted by the 3rd defendant on behalf of defendants 1 and 2 for removal of the obstruction; during the pendency of the said suit, defendants 1 to 3 on the one hand and defendants 4 and 5 on the other colluded and executed Exts. B6 to B-14 sale deeds. Of course defendants 4 and 5 denied the allegation and have maintained that the collusion was between plaintiffs on the one hand and defendants 1 to 3 on the other. In appreciating the said contention certain circumstances are to be taken into consideration. Ext. A-11 plaint is dated 3-12-1984. Ext. A-15 written statement was filed by defendants 4 and 5 on 22-1-1985, the commissioner visited the property on 15-12-1984 and the report was filed on 22-1-1985. Sale deed Exts. B6 to B-14 were executed on 25-1-1985, and Ext. A-16 compromise was filed on 7-2-1985 wherein it is stated that the parties have settled their dispute by executing Exts. B6 to B-14 and therefore the suit may be dismissed. Admittedly Exts. B6 to B-14 were registered at residence. The contesting parties compromised, and that could only be after negotiation, discussion and exchange of views. If that is so, it is probable that the agreement to sell Ext. A1 also normally could have been mentioned. In support of the contention of defendants 4 and 5, that plaintiffs and defendants 1 to 3 have colluded, it was pointed out that, PW.1 admitted that he arranged the Advocate to issue notice and to institute Ext. A-11 suit. That can hardly be a circumstance which could even remotely suggest collusion between the plaintiffs and defendants 1 and 2. As has already noticed, on 15-9-1984 the sale deed could not be executed because of the obstruction in the corridor and according to the plaintiffs Ext. A-20 notice was issued by defendants 1 and 2 to defendants 4 and 5 demanding the removal of the obstruction. In that context, if the plaintiffs who were interested in getting the sale deed executed, arranged an Advocate for instituting the suit for removal of the obstruction which could facilitate the execution of the sale deed, that cannot support a case of collusion. On the other hand, that can support the plaintiffs' case that they were anxious to get the sale deed executed. On the other hand, that can support the plaintiffs' case that they were anxious to get the sale deed executed. It will be noticed that, the plaintiffs are carrying on business in the six shop rooms as tenants of defendants 1 and 2 when Ext. A-1 agreement was executed. The sequence of events certainly is capable of pointing to a collusion between defendants 1 to 3 on the one hand and defendants 4 and 5 on the other. Defendants 4 and 5 who were hotly contesting Ext. A-11 suit, got the sale deed executed followed by Ext. B-16 compromise. The parties are not strangers. The premises where defendants 4 and 5 carry on business is in the same property where the disputed six shop rooms also are situated. A realistic assessment of the circumstance with due regard to ordinary human conduct could only lead to the inference that defendants 4 and 5 certainly could have known as to existence of Ext. A-1 or atleast; in the circumstance, it was obligatory on their part to have enquired as to the character of the possession of the plaintiffs and if such enquiry was made the existence of Ext. A1 agreement would have been revealed to them. The whole events that preceded Ext. A-16 compromise if closely analysed can lead only to the irresistible inference that the existence of ExtA1 agreement could not have escaped the notice of defendants 4 and 5. The very occasion to institute Ext. A-11 suit was created and furnished by defendants 4 and 5 by installing rolling shutter in the corridor which prevented the execution of the sale deed in favour of plaintiffs on 15-9-1984. The pendency of Ext. A-11 suit offered defendants 4 and 5 a commanding position viz-a-viz defendants 1 to 3; and it was in that circumstance Exts. B6 to B-14 sale deeds were executed. 15. As per S.3 of the Transfer of Property Act a person acquiring immovable property shall be deemed to have notice of the title, if any of the person who is for the time being in actual possession of the property. As has seen, the circumstances are such that defendants 4 and 5 had notice of Ext. A1. Alternatively, it is the case of the plaintiffs that had defendants 4 and 5 enquired as they were duty bound to enquire, they could have known as to the existence of Ext. As has seen, the circumstances are such that defendants 4 and 5 had notice of Ext. A1. Alternatively, it is the case of the plaintiffs that had defendants 4 and 5 enquired as they were duty bound to enquire, they could have known as to the existence of Ext. A1 and hence they cannot maintain that they are transferees without notice. It was contended by the learned counsel for defendants 4 and 5, since defendants 1 to 3 handed over the rent deeds Ext. B-17 series which showed the plaintiffs are only tenants, in the circumstances, they were not bound to make any further enquiry. In the decision in Parvathathammal v. Siva Sankara (AIR 1952 Madras 265) there was an agreement to sell in favour of a mortgagee in possession; but subsequently the property was sold to a stranger. The purchaser omitted to enquire if the mortgagee had any other right. It was held that, when a person other than the vendor is in actual possession of the property it is the duty of the prospective purchaser to ascertain what all rights the person in actual possession really has in respect of the property. It was also held that the prospective purchaser was bound to make enquiry as to whether the person has any right other than the right as a mortgagee. In the decision in Mohammed Aslam Khan v. Feroze Shah (A.I.R.1932 P.C. 228) it is held that where the transferees had knowledge of facts which would put them on enquiry which if prosecuted would have disclosed a previous agreement, such transferee is not a transferee without notice of the original contract. The decision in Veeramalai v. Thadikara (AIR 1968 Madras 383) also held, subsequent purchaser has to enquire as to the character of possession when a person other than the vendor is in possession. The plaintiffs while were in possession as tenant obtained Ext. A1 agreement, gave advance, and on a subsequent date, they paid Rs. One lakh towards the purchase amount. They have a claim that they are in possession in part performance under S.53-A of the Transfer of Property Act, 1882. With due regard to the facts and circumstances adverted to early, it is a case where defendants 4 and 5 were bound to enquire as to the character of the possession of the plaintiffs and had they made such enquiry, the existence of Ext. With due regard to the facts and circumstances adverted to early, it is a case where defendants 4 and 5 were bound to enquire as to the character of the possession of the plaintiffs and had they made such enquiry, the existence of Ext. A1 agreement would have been revealed to them. Since they have omitted to do so, they cannot claim that they are transferees without notice of Ext. Al. Thus the natural conclusion is, that defendants 4 and 5 are transferees with notice of Ext. A1, and consequently Ext. A1 is enforceable against them. 16. Defendants 4 and 5 have maintained that the prayer in the plaint is such that even if it is held that they are transferees with notice of Ext. A1, the same cannot be enforced in the manner prayed for in the plaint, and according to them, they cannot be compelled to join a sale deed reserving the right of user of the corridor as well as stair case to the upstairs of the said shop rooms because such a covenant is not enforceable by the transferee of the vendor as per S.11 of the Transfer of Property Act. To appreciate this argument, it is necessary to know the location of the corridor as well as the staircase. The sketch appended to Ext. A-13 commissioner's report gives the relative positions of the shop rooms and the building situated on the north of the shop rooms which defendants 4 and 5 acquired under Exts. B1 and B-15. The road is situated on the south of the whole property. Touching the road on the north are the seven shop rooms of which six shop rooms excluding the one on the east are the subject matter of Ext. A1 agreement. The corridor is situated on the east of the third shop room from the west. Exts. B-6 to B-14 sale deeds take in the seven shops rooms. The first relief in the plaint is to direct the defendants to execute the sale deed for the property comprised in Ext. A1 including the right for the free user of the entrance as well as the stair case and also the first floor portion of the building as stipulated in Ext. A1. 17. With respect to 19.509 cents and the building which is the northern portion of the whole property, Exts. A1 including the right for the free user of the entrance as well as the stair case and also the first floor portion of the building as stipulated in Ext. A1. 17. With respect to 19.509 cents and the building which is the northern portion of the whole property, Exts. B1 and B15 were executed by defendants land 2 on 1-1-1982 in favour of defendants 4 and 5. According to defendants 4 and 5 Exts. B1 and B15 were with respect to property inclusive of the corridor also. Therefore, a reservation of the right of user of the corridor is void under the First Part of Section 11 of the Transfer of Property Act. The said restriction cannot be saved under the Second Part of S.11 as according to these defendants the right is enforceable only between the vendor and the vendee and the same is not enforceable by the subsequent transferee of the vendor. S.11 of the Transfer of Property Act reads: "11. Restriction repugnant to interest created.--Where, on a transfer of property, an interest therein is created absolutely in favour of any person, but the terms of the transfer direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be entitled to receive and dispose of such interest as if there were no such direction. Where any such direction has been made in respect of one piece of immovable property for the purpose of securing the beneficial enjoyment of another piece of such property, nothing in this Section shall be deemed to affect any right which the transferor may have to enforce such direction or any remedy which he may have in respect of a breach thereof". If only the corridor also is transferred under Exts. B1 and B-15, can the said contention of defendants 4 and 5 be sustained. Under Ext. B1 the first defendant transfers his one-half right in the property scheduled therein with a reservation to use the gate by him, his wife the second defendant and their assignees. The other half of the second defendant was released under Ext. B-15. The half right of 1st defendant in 19.509 cents lying one metre north of the northern wall of the shop rooms was transferred under Ext. A1; with a reservation to use the gate by the first defendant, his wife, the second defendant and their transferees. Ext. The other half of the second defendant was released under Ext. B-15. The half right of 1st defendant in 19.509 cents lying one metre north of the northern wall of the shop rooms was transferred under Ext. A1; with a reservation to use the gate by the first defendant, his wife, the second defendant and their transferees. Ext. B1 enjoins that defendants 4 and 5 will not be whittled to make any construction within the property having a width of one metre situated immediately on the north of the northern wall of the shop rooms. Now as has already noticed, there is a corridor in between the rooms. The description of the property in the schedule and the recitals in the document do not mention the corridor. 18. The argument by the learned counsel for defendants 4 and 5 is, the gate in the circumstance would include the corridor also. We are unable to agree with the said argument; gate cannot be treated as synonymous with the corridor, and the reservation of the right of user in this regard is only with respect to the gate. Though the corridor is not included in Exts. B1 and B-15, defendants 4 and 5 also will be entitled to use the same as an implied grant under S.13 of the Indian Easements Act 1882. Alternatively, it was contended by the learned counsel for the plaintiffs that even if property inclusive of the corridor also was transferred under Exts. B1 and B-15 the rights reserved under Ext. B1 is enforceable at the instance of the subsequent transferee also. On the other hand, the learned counsel for the defendants 4 and 5 contended that transferee is not entitled to enforce such a covenant, and therefore at the instance of the plaintiffs who have got only Ext. A1 agreement to sell also cannot enforce the same. This requires examination of the right of such a transferor who has a covenant for the beneficial enjoyment of his property, the right of the" transferee of the said lands and also the right of a person who " has an agreement to sell in his favour with respect to the said land. 19. S.11 of the Transferor Property Act deals with positive or affirmative covenant. 19. S.11 of the Transferor Property Act deals with positive or affirmative covenant. Before the amendment of Transfer of Property Act in 1929 both Ss.11 and 40 were so worded as to take in positive and negative covenants. After the amendment S.11 would take in positive or affirmative covenants and S.40 negative covenants. Even as between the transferor and transferee a condition that the property would be enjoyed only in a particular manner would be void. But when such restriction is made for the beneficial enjoyment of the property retained by the transferor, the same is saved under Second Part of S.11. Thus a positive covenant for the beneficial enjoyment of the property of the transferor is saved only as between the parties to the transfer as per S.11. But a negative covenant if imposed on one land for the beneficial enjoyment of another land. would be binding not only on the original parties, but even on subsequent transferees. In other words unless the covenant effecting the enjoyment of the land is for the benefit of the another land or a portion of the land which is retained by the transferor, it will not be binding on any one not even between the contracting parties. If it is for the benefit of another land or portion of land retained by the transferor it will be binding on the contracting parties whether it is positive or negative. A negative covenant as per S.40 of the Transfer of Property Act, will be binding on the transferee with notice also. In the decision in Motilal J. Boal v. Corporation of Bangalore (1962 Mysore Law Journal Supplement page 148) a building scheme was executed by the Bangalore City Municipality. For that purpose the Municipality acquired certain area of land and the same was plotted out in building sites and sold the said sites by auction to several purchasers imposing on them certain conditions and restrictions regarding the use of the sites and also putting up of structures. The person who got interest in site No. 19 claimed that he is entitled to insist the owner of site No. 20 should not be permitted to build on the said site in contravention of the restrictions and conditions and he claimed that he is entitled to call upon the municipality to see that the respondent conform to the said restrictions and conditions. A Division Bench of the Mysore High Court held that after the amendment of the Transfer of Property Act in 1929 as between the parties to the transfer, covenants both affirmative as well as restrictive can be enforced; but only negative covenants can be enforced against a subsequent transferee of the original transferee. In that case, since it was found that neither the appellant nor the respondent had obtained a sale deed from the municipality conveying respective plots, it was held he was not entitled to enforce the covenant. This decision noticed the scope of S.11 and 40 of the T.P.Act. 20. Thus a negative covenant is enforceable against a transferee with notice. But as noticed, the contention by defendants 4 and 5 is, the same can be enforced only by the transferor, not by his transferee or a person who has obtained only an agreement to sell the said property of the transferor. Reliance was made by the learned counsel for defendants 4 and 5 on decision in Bhagwat Prasad v. Damodar Das (AIR 1976 Allahabad 4115 in support of his contention that, a transferee of the original vendor cannot enforce such a covenant. In that case the original owner of a property divided the property into five plots and property having 10 feet width was left for the benefit of all the purchasers enjoining that no construction would be made on that strip of land by any purchaser. One plot was retained by the vendor. The question that arose was whether the same was enforceable at the hands of a transferee against another transferee. The transfers were effected on the same day. It was held, S.11 of the Transfer of Property Act only allowed the transferor to impose conditions on the transferee for the beneficial enjoyment the portion retained by the transferor and can be enforced only by the transferor and that the transferor cannot impose a condition for the benefit of another property which he is transferring or intending to transfer on the same day. But proceeded to hold: "If such a condition has been imposed by the transferor for his own benefit, he may no doubt transfer that benefit to another person if the land for the benefit of which such a condition has been imposed is subsequently transferred". But proceeded to hold: "If such a condition has been imposed by the transferor for his own benefit, he may no doubt transfer that benefit to another person if the land for the benefit of which such a condition has been imposed is subsequently transferred". Thus this decision really supports the view that a transferee can also enforce the covenant of the said nature. 21. Unlike S.11, S.40 does not enjoin the covenant falling under the said section is enforceable between the transferor and transferee only. We read S.40: "40 Burden of obligation imposing restriction on use of land-Where, for the more beneficial enjoyment of his own immovable property, a third person has, independently of any interest in the immovable property of another or of any easement thereon, a right to restrain the enjoyment in a particular manner of the latter property, or or of obligation annexed to ownership but not amounting to interest or easement.-Where a third person is entitled to the benefit of an obligation arising out of contract, and annexed to the ownership of immovable property but not amounting to an interest therein or easement therein, such right or obligation may be enforced against a transferee with notice thereof or a gratuitous transferee of the property affected thereby, but not against a transferee for consideration and without notice of the right or obligation nor against such property in his hands. Illustration A contracts to sell Sultanpur to B. While the contract is still in force, he sells Sultanpur to C, who has notice of the contract. B may enforce the contract against C to the same extent as against A. A restrictive and negative convenient can be used by third party against a transferee as laid down in S.40. The transferee of the original vendor can enforce it against the transferee of the land burdened with the covenant (Kali Charan Chakraborty (deceased by LRs.) and others v. Durga Charan Banerjee (deceased by LRs.) and others (AIR 1985 NOC 180 (Calcutta)). The reservation in Ext. B1 is the right of user of the corridor and the staircase, that reservation does not require defendants 4 and 5 to do any positive act. Therefore, the said reservation in favour of the vendor operates as a negative covenant so far as defendants 4 and 5 are concerned. The reservation in Ext. B1 is the right of user of the corridor and the staircase, that reservation does not require defendants 4 and 5 to do any positive act. Therefore, the said reservation in favour of the vendor operates as a negative covenant so far as defendants 4 and 5 are concerned. Since it is a negative covenant, the same is enforceable even against a transferee with notice as per S.40 of the T.P.Act. Defendants 4 and 5 are transferees of the land burdened with the covenant. Therefore, at the instance the vendees of the plaint schedule property for the beneficial enjoyment of which the covenant was made, the same is enforceable against defendants 4 and 5. 22. Now, the question that remains for consideration in the context is whether the plaintiffs who are not transferees of the original vendor but are only persons who have Ext. A1 agreement to sell in their favour can enforce the covenant. That which defendants 1 and 2 could enforce under Ext. A1 against defendants 4 and 5 can be enforced by the plaintiffs also. A contract for sale though does not create an interest in the land, creates a personal obligation of fiduciary character which can be specifically enforced not only against the vendor but against transferees with notice also. The illustration to S.40 makes it clear that the agreement can be enforced against the subsequent transferee with notice to same extent as against the transferor. As has already noticed the covenant since was enforceable at the hands of defendants 1 and 2, the same is equally enforceable by the plaintiffs who obtained Ext. A1 from them. The argument by the learned counsel for the defendants thus does not merit acceptance. 23. Yet another argument advanced by the learned counsel for defendants 4 and 5 is, no such reservation having been made in Ext. B-15 and the same being only a release, the reservation is not enforceable. It is true that a covenant like the one reserved in Ext. B1 cannot be assigned independently of the land for the beneficial enjoyment of which the reservation was made. It is clear from a reading of Ext. B1 itself that the reservation in ExtB1 is for the beneficial enjoyment of the shop rooms. It is true that a covenant like the one reserved in Ext. B1 cannot be assigned independently of the land for the beneficial enjoyment of which the reservation was made. It is clear from a reading of Ext. B1 itself that the reservation in ExtB1 is for the beneficial enjoyment of the shop rooms. Though the shops face the road on the south, the plaintiffs have the right to go to the first floor, and since the stair case is fixed on the northern wall of the shop rooms, access through the corridor is necessary. Further one metre width of land immediately adjacent to the north of the northern wall of the shop rooms is specifically left in Exts. B1 and B-15 enjoining that defendants 4 and 5 are not entitled to construct anything in the said strip of land. That also would show that the owner of the shop is entitled to go to the back and to use the staircase for going to the first floor. The fact that, now no construction is made on the first floor cannot affect the said reservation. So in relation to the right of the owner of the said shop rooms, though no reservation is made in Ext. B-15 in view of the fact that defendants 1 and 2 were co-owners the non mention of reservation in Ext. B-15 in the circumstance cannot affect the right of the user reserved in Ext. B1. In such circumstance we find it difficult to accept the contention of the learned counsel for the defendants that since covenant is not enforceable against defendants 4 and 5 the contract has become impossible of performance. 24. It was contended by the learned counsel for defendants 4 and 5 inasmuch as Ext. A-11 suit was instituted at the instance of the plaintiffs for removal of obstruction in the corridor and the said suit having been compromised, plaintiffs are estopped from contending that they are entitled to have the sale deed executed by defendants 4 and 5 also with provision for user of the corridor. The whole case of these defendants in this regard rests on the assumption that Ext. A-11 suit was instituted at the instance of the plaintiffs. As has already seen all that the plaintiffs did was to arrange a counsel for defendants 1 and 2 to issue the notice. The whole case of these defendants in this regard rests on the assumption that Ext. A-11 suit was instituted at the instance of the plaintiffs. As has already seen all that the plaintiffs did was to arrange a counsel for defendants 1 and 2 to issue the notice. The plaintiffs were interested in removing the obstruction and in such circumstance simply because they arranged a counsel for issue of notice to defendants 4 and 5 or for instituting Ext. All suit cannot by itself support a case of collusion as is attempted. On the other hand, as has already noticed, the circumstance would show, collusion was between defendants 1 to 3 on the one hand and defendants 4 and 5 on the other. Ext. A-16 compromise was preceded by Exts. B6 to B-14 sale deeds. Therefore, before the compromise, there was negotiation between defendants 1 to 3 on the one hand and defendants 4 and 5 on the other is clear, and as a result of that negotiation Exts. B6 to B-14 sale deeds were got executed and then Ext. A-16 compromise was filed. In that the plaintiffs could have had no role. The compromise evidently was the result of the negotiation between defendants 1 to 3 and defendants 4 and 5. In such situation the circumstance relied on by the defendants 4 and 5 in support of their contention that the plaintiffs are barred by estoppel from claiming the reservation does not actually exist. We see no substance in the said argument by the learned counsel for defendants 4 and 5. 25. We notice, the lower court in decreeing the suit for specific performance did not state as to which defendant is entitled to the sale consideration to be deposited by the plaintiffs. Lower court has found that the cheques, drafts and other bank accounts produced by defendants 4 and 5 are a doubtful transaction. Now we found that Exts. B-6 to B-14 were taken by defendants 4 and 5 with notice of Ext. A1 and hence the same is enforceable against them also. Defendants land 2 contended that sale deeds in favour of defendants 4 and 5 are with full consideration and good faith. Defendants 4 and 5 maintained that they paid consideration. Therefore, we hold the balance consideration to be deposited by the plaintiffs should belong to defendants 4 and 5. A1 and hence the same is enforceable against them also. Defendants land 2 contended that sale deeds in favour of defendants 4 and 5 are with full consideration and good faith. Defendants 4 and 5 maintained that they paid consideration. Therefore, we hold the balance consideration to be deposited by the plaintiffs should belong to defendants 4 and 5. The plaintiffs will make the deposit of the balance sale consideration within a month of this judgment and take steps to get the sale executed as per Ext. A-1. 26. Subject to the said modification, the decree and judgment of the lower court are only to be confirmed and the appeals are liable to be dismissed. In the result the appeals fail and the same are dismissed.