Vijender Jain ( 1 ) THE facts leading to the filing of the presentappeal are that the present appeal has been filed by the defendants againstthe order dated 30-9-1978 passed by Shri M. S. Rohilla. Sub Judge 1st Class,delhi. Sunder Singh, ancestor of the present defendants (appellants herein)was allotted two houses bearing Nos. M/67-A and M/67b, Malviya Nagar,new Delhi by the Ministry of Rehabilitation, Government of India. Thesale consideration whereof was required to be paid in instalments. Therespondents filed the suit against the appellants in the Court valuing the suitat Rs. 8,580. 00 thereby fixing the value of the property in question. Theappellants-defendants in their written statement took the objection to thevaluation, the same being wrong as each quarter was more than Rs. 15,000. 00at the relevant time. It is important to mention that for the first time suitwas filed by the respondents in the year 1965 whereas the agreement inquestion was entered into on 22/06/1959. Prior to the filing of the suitin 1971 the respondents filed Suit No. 328 of 1965 in the Court of Shri S. C. Ahuja, Sub Judge 1st Class, Delhi. ( 2 ) ON 22/06/1959 the said Sunder Singh enteted into an agreement with the respondent that in case the respondent pays the arrears of rentin respect of both the houses and the sum due in respect of house bearingno. M/67-B, Malviya Nagar, New Delhi amounting to Rs. 5000. 00, hewould transfer the said house No. M/67-B to the respondents inpart performance thereof. In consequence thereof said Sundersingh transferred the said house to the respondents with vacant possession. It was further agreed between the said Sunder Singh andthe respondent that on respondent s advancing a sum of Rs. 3,000. 00 to thesaid Sunder Singh for payment to the Government which sum was due inrespect of house No. M/67-A the said sum would be returned by the saidsunder Singh in five yearly instalments of Rs. 600. 00 each commencing from 1/01/1960 in default whereof said Sunder Singh would convey thehouse No. M/67-A also to the respondent subject to the respondent s payingthe sums due to the Government in respect of that house. The relevantclause of the said agreement reads as follows :- "1. 600. 00 each commencing from 1/01/1960 in default whereof said Sunder Singh would convey thehouse No. M/67-A also to the respondent subject to the respondent s payingthe sums due to the Government in respect of that house. The relevantclause of the said agreement reads as follows :- "1. that the entire cost of the quarter and arrears of rentshall be deposited or caused to be deposited with the Governmentof India by the second party either in lump sum or by instalments orby offering claims or by one or more of these modes at the discretionof the second party or Shri D. N. Kaul husband of the second party. The said payments shall be made in the name of the first party andall other steps shall be taken by both the parties to have the ownership rights of the quarter in question transferred in favour of thefirst party and registration effected in his favour. The first partyshall refund a sum of Rs. 3,000. 00 only to the second party or herhusband Shri D. N. Kaul, whosoever, shall demand the same, in fiveyearly instalments of Rs. 600. 00 each year payable on or before thefirst day of January each year. The balance of the purchase pricepaid as also the arrears of rent paid shall be deemed and treatedas advance payment of purchase price paid by or on behalf of thesecond party to the first party for the portion 67b agreed to besold and transferred to her and shall represent the full and finalconsideration therefor. Should at any stage the Government of India increase ordecrease the purchase price of the quarter or its demand withrespect to arrears or rent, the first party shall not be liable torefund and repay more than Rs. 3,000. 00 to the second party norshall the first party demand any concession for the remission in thevalue paid in respect of the entire quarter or the arrears of rentdeposited in respect thereof and whatever be the amount thus paidless by Rs. 3,000. 00 to be repaid and refunded to the second party bythe first party shall be treated as the full, final and adequate consideration for the said quarter No. 67b including half portion oftotal land area of 67a and B from the second party to the firstparty. 4. 3,000. 00 to be repaid and refunded to the second party bythe first party shall be treated as the full, final and adequate consideration for the said quarter No. 67b including half portion oftotal land area of 67a and B from the second party to the firstparty. 4. that the amount paid or caused to be paid or deposited onaccount of purchase price and arrears of rent in respect of theabove quarter 67-A and B with the Government of India shall betreated as the first charge of the second party and her husband thesaid Shri D. N. Kaul on the property so long as 67b is not effectivelytransferred to the 2nd party and Rs. 3,000. 00 repaid to them. 5. that if the first party fails to refund the said sum of rupeesthree thousand to the second party as stipulated and if any oneinstalment due remains unpaid after 30 days R. A. D. , notice in thatbehalf the entire sum of Rs. 3,000. 00 or balance due shall become dueat once and on the failure on the part of the first party to repay thesame within 15 days next, he shall transfer the other portion ofthe property namely, 67a also to the second party or the saidshri D. N. Kaul or her nominee for the said consideration ofrs. 3,000. 00 and give her/him or their nominee vacant and peacefulpossession thereof and have a deed of transfer executed and registration duly effected before the proper registering authority. 8. that in case the first party shall fail to execute his part ofthe agreement and fail to transfer quarter No. 67b to the secondparty and execute sale deed in her favour and have it duly registered he shall be liable to pay the second party a sum of rupees five. thousand, plus the aforesaid amount paid or caused to be paid bythe second party to the Government in respect of the said quarteron account of purchase price and arrears of rent and the moniesspent on improvements and additions, as liquidated damages without prejudice to the second party s right to demand the specificperformance of this agreement and to have the specified share, i. e. Quarter No. 67b transferred to herself compulsarily through acourt of law. The same provisions shall apply if and when theright to have the quarter No. 67a transferred in favour of secondparty or Shri D. N. Kaul arises and the first party fails to do soeffectively. " ( 3 ) IN terms of the aforesaid agreement respondent was required toadvance money to Government Authority. The respondent made all thepayments to the Government through her husband pertaining to Houseno. 67b, the possession of this portion was also given to the respondent asstated earlier. Sunder Singh died on or about 1964 and was survived by thepresent appellants as his legal heirs. Sunder Singh did not pay any instal-ments towards the loan advanced to him by the respondent on which accountthe respondent claimed that she was entitled to the transfer of House No. 67a also as per the terms of agreement. ( 4 ) AFTER the death of Sunder Singh, appellant No. 1 Smt. Gurnamkaur was entered a new allottee by Government in its record. The case ofthe respondent is that after the death of Sunder Singh, respondent was notallowed to deposit the money which was due as a consequence of which therespondent could not deposit the money in respect of the two houses andtowards the dues of the Government. Before tiling of the present suit fromwhich this appeal arises, the respondent had filed a suit bearing Suit No. 328of 1965 for perpetual injunction against the appellant for restraining themfrom transferring the said houses to any person against the interest of therespondent-plaintiff. During the pendency of the suit appellant No. 1 (defendent therein) authorised the respondent to deposit the sum due againstthe said houses and in pursuance of the terms ofthe agreement. The caseof the respondent is that she accordingly deposited the said amount as well. The case of the respondent before the Trial Court was that the sum ofrs. 3,000. 00 advanced to the deceased Sunder Singh was not repaid thereforeshe was entitled for the transfer of House No. M-67/a as was stipulated bythe agreement dated 27/06/1959. On the basis of the written statementfiled by the appellant/defendant, the Trial Court framed the followingissues:- 1. Whether the plaintiff is entitled to the specific performance ofthe agreement dated 22/06/1959 ? OPP2. Whether the suit is not maintainable for the reasons mentionedin the preliminary objections 1 and 2 ? OPP3. Whether the suit is correctly valued for the purpose of Courtfee and jurisdiction ? OPP4. Whether the plaintiff is entitled to the specific performance ofthe agreement dated 22/06/1959 ? OPP2. Whether the suit is not maintainable for the reasons mentionedin the preliminary objections 1 and 2 ? OPP3. Whether the suit is correctly valued for the purpose of Courtfee and jurisdiction ? OPP4. Whether the agreement dated 22/06/1959 is not enforceable? OPP ( 5 ) ( 6 ) FEELING aggrieved by the said order of the Trial Court the appellants preferred this appeal. ( 7 ) THE main ground urged by the learned Counsel for the appellantshri R. L. Tandon before us was that on a proper consideration of the agreement respondent-plaintiff failed to perform her part of the agreement andwas not entitled to invoke the provisions of Specific Relief Act in her favour. ( 8 ) THE second contention of Shri Tandon, learned Counsel for theappellants was that Sec. 74 of the Contract Act comes into play in relationto property No. M-67/a as there was no agreement in relation to the saidproperty but it was merely a penalty clause for non-performance of theobligations by the appellants in relation to the payments made for propertyno. M-67/a. Sec. 74 of the Contract Act reads as under :- "compensation for breach of contract where penalty stipulated for (When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, or if thecontract contains any other stipulation by way of penalty, the partycomplaining of the breach is entitled, whether the not actualdamage or loss is proved to have been caused thereby, to receivefrom the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be,the penalty stipulated for. " ( 9 ) IN our opinion Sec. 74 of the Contract Act cannot help theappellant in view of the terms of the agreement dated 22/06/1959. ( 10 ) THE third leg of the argument of Shri Tandon was that theagreement dated 22/06/1959 was hit by the provisions of Sec. 23 of thecontract Act and the said agreement was opposed to public policy as Sundersingh was allotted the premises under the Terms of Displaced Persons (Compensation and Rehabilitation) Act, 1954 and in relation to the saidproperty, no contract of sale was lawful. ( 11 ) IT is the admitted case that the respondent-plaintiff made payments on various dates and according to Shri Tandon the respondent madepayment of Rs. 8240. 04 and Rs. 255. 59 till 2/12/1965. Thoughaccording to the respondent she made payments, yet in the suit the totalcost of the property was not mentioned but during the hearing of the appealcounsel for the respondent filed C. M. P No. 346 of 1993. Notice of thesame was issued to the Counsel for the appellant who filed reply to the saidapplication. This application was filed by the respondent to clarify thecontroversy raised in relation to the amount of Rs. 2221. 10 paid on 2 5/03/1968. According to the Counsel for the appellant the said amountwas paid by the appellant and according to the respondent the amount wasnot paid in 1968 but in 1965 that too by the respondent. According torespondent there is some over writing which shows that the number 5 waswritten and thereafter 8 was over written on the same which makes 1965to 1968. We think that at this stage it is not material to go into the controversy as in the written statement filed by the appellants nowhere stated thatthey had made the payment of the said amount. Moreover, if we carefullyexamine the agreement to sell which is Ext. PI/i which was drafted byshri S. Watel, Advocate who was also examined as P. W. 1. Shri Watel inhis testimony has stated that the said agreement was drafted at the instanceof Sunder Singh and plaintiff. The said agreement specifically states thatthe said Sunder Singh was not in a position to pay the purchase price of thesaid quarter or the first instalment thereof and after Sunder Singh receivedthe final demand notice for payment of the first instalment to the Government with the warning that in case of non-payment the quarter would notbe transferred to him with the consequence that it will be auctioned and soldto a third party. Further on the agreement says that for the aforesaidreasons Sunder Singh wanted to associate someone with him for the purchase of the said quarter in order to be able to continue to occupy the sameand own at least a part of the said property. Further on the agreement says that for the aforesaidreasons Sunder Singh wanted to associate someone with him for the purchase of the said quarter in order to be able to continue to occupy the sameand own at least a part of the said property. It was further stipulated in theagreement that respondent was eager and willing to cooperate with Sundersingh and purchase half of the premises, namely, M/67-B with its kitchen,bath, lavatory and a common wall between M/67-A and M/67-B at a priceof Rs. 5,000. 00 and arrears of rent due in respect of the property to be paidto the Government in the account of Sunder Singh in cash. Sunder Singhfurther assured that he was entering into the said agreement for the betterment of his family and out of necessity. In view of the unequivocal terms ofthe agreement and in the absence of any specific plea raised in the writtenstatement by the appellant that they had paid the aforesaid amount ofrs. 2221. 10 it is too late in the day for them to take up such a plea. ( 12 ) ANOTHER aspect of the matter is Ext. PW5/5 which is a registeredletter sent by respondent-plaintiff dated 1/05/1962 to said Sunder Singhreferring for the agreement of sale dated 22/06/1959 wherein in terms ofclause (1) of the agreement she had asked the said Sunder Singh to pay herrs. 600. 00 on the 1st day of January each year beginning with the 1st day ofjanuary 1960. She has further stated in the said letter that three instalmentsof Rs. 600. 00 each have become due by now, i. e. instalments due on 1-1-1960,1-1-1961 and 1-1-1962. She has further stated in the said letter that underclause (5) of the said agreement she must receive the instalments due within30 days as provided in the aforesaid clause. The failure to pay shall invokethe consequences envisaged by the aforesaid clause of the agreement. ( 13 ) SHRI Tandon has argued that there was no question of Sundersingh receiving the payment of Rs. 3,000. 00 as no receipt was produced onrecord by the respondent. Needless to say that in view of the admittedreceipt of the letter Ext. The failure to pay shall invokethe consequences envisaged by the aforesaid clause of the agreement. ( 13 ) SHRI Tandon has argued that there was no question of Sundersingh receiving the payment of Rs. 3,000. 00 as no receipt was produced onrecord by the respondent. Needless to say that in view of the admittedreceipt of the letter Ext. PW5/5 it was for Sunder Singh or his legal representatives to have denied or controverted the letter under reference and theirresistable conclusion which one can derive is that Sunder Singh failed toadhere to the terms of Clause (5) of the agreement and by virtue of thatfailure respondent became entitled to get the transfer of the other portion ofthe property, namely, M-67/a also for the said consideration of Rs. 3,000. 00as per the terms of the agreement. It is unfortunate that the agreement tosell was executed in the year 1959 and thirty-four years have gone by in thelegal proceedings. The appellants are enjoying the fruits of the portion ofthe property M/67-A, Malviya Nagar without paying any charges on accountof interim order passed from time to time by this Court. In view of our above discussion, the appeal is hereby dismissed withcosts. Interim order made earlier in this appeal are vacated. Counsel s feers. 1000/.