Sathy v. Sayed Mohammed — 1997 DIGILAW 469 (KER)

Judgment :- K.S. Radhakrishnan, J. Appellants are defendants 1 and 2. 2. Suit was for specific performance of Ext. Al agreement dated 29.4.1993 entered into between defendants 1 and 2 and the plaintiff for sale of 3.140 cents of land and the buildings thereon situated in Sy. No. 153/1 of Mattancherry Village, for a sale consideration of Rs. 1,35,000/ 3. Plaint schedule property comprised of a residential building bearing No. CC 4/ 551 and two shop rooms bearing Nos. 4/549 and 550. Defendants 1 and 2 agreed to execute the sale deed within a period of six months from the date of the agreement, after getting the possessory mortgagee and tenants evicted. Since defendants 1 and 2 failed to comply with the terms of the agreement, plaintiff sent a lawyer notice Ext. A2 dated 25.10.1993 before the expiry of the six months' period directing them to comply with terms of the agreement and execute the sale deed within the time stipulated in the agreement. Plaintiff stated in the notice that he was ready and willing to perform his part of the contract. Defendants 1 and 2 did not sent any reply to the lawyer notice. 4. Plaintiff later came to know that residential building bearing No. CC 4/551 was in the occupation of one Hamza, and on his death, his wife and children were residing there. He therefore, impleaded the wife as fifth defendant, and children' as defendants 6 to 8. Two shop rooms were also found to be in the occupation of tenants who were also impleaded as defendants 3 and 4. In the plaint, plaintiff reiterated that he is ready willing to perform his part of the contract. He has sought for a decree for specific performance after clearing all encumbrances and for mesne profits at the rate of Rs. 750/- per month from the date of the suit till recovery and also for consequential reliefs, 5. Defendants 1 and 2 filed a written statement. Defendants 3 to 8, even though entered appearance, did not file any written statement. Defendants 1 and 2 did not deny execution of Ext. Al agreement. They admitted receipt of Rs. 25.000/-. According to them, agreement was executed as a security for the above mentioned amount, which was received as a loan to discharge liabilities incurred in connection with the marriage of first defendant's daughter. It is their case that Ext. Defendants 1 and 2 did not deny execution of Ext. Al agreement. They admitted receipt of Rs. 25.000/-. According to them, agreement was executed as a security for the above mentioned amount, which was received as a loan to discharge liabilities incurred in connection with the marriage of first defendant's daughter. It is their case that Ext. Al was executed due to undue influence and coercion, and that the terms of the agreement were impossible of compliance within the time stipulated in the agreement. They had no intention to part with the property, and that second defendant is making his livelihood from the income derived from his tailoring business. 6. In order to establish the case of the plaintiff, he examined himself as PW1 and the scribe of Ext. Al as PW2. On the side of defendants, second respondent got himself examined as DW1. 7. After considering oral and documentary evidence, the trial court decreed the suit. Aggrieved by the judgment and decree of the trial court, defendants 1 and 2 have come up in appeal. 8. The jurisdiction to order specific performance is based on the existence of a valid enforcement contract. In the instant case, execution of Ext. Al agreement was not disputed by parties. Counsel for defendants 1 and 2 even though pointed out that there is no signature of defendants 1 and 2 at page 3 of Ext. Al, neither in the written statement nor in the oral evidence of DW1, execution of Ext. Al was disputed. The case set up by defendants 1 and 2 is that the agreement was executed as a security for the amount borrowed in order to discharge certain liabilities incurred in connection with first defendant's daughter's marriage. Apart from the oral testimony of DW1, there is no other evidence whatsoever to conclude that Ext. Al was executed as a security for the loan amount advanced by the plaintiff. In the absence of any evidence, we are in agreement with the finding of the trial court that Ext. Al was executed not as a security for the loan amount advanced by the plaintiff. 9. Counsel for defendants 1 and 2 contended that plaintiff is not entitled to a decree for specific performance, since he failed to aver and prove that he has performed, or he has always been ready and willing to perform essential terms of the contract. Al was executed not as a security for the loan amount advanced by the plaintiff. 9. Counsel for defendants 1 and 2 contended that plaintiff is not entitled to a decree for specific performance, since he failed to aver and prove that he has performed, or he has always been ready and willing to perform essential terms of the contract. Counsel referred to S.16(c) of the Specific Relief Act and placed reliance on the decision of the Gujarat High Court in Chandrakant Shantilal Pandya and Ann v. Savitabehn Thakorial Shah, (1992) 3 Current Civil Cases 265, and contended that simply because plaintiff has pleaded that he is ready and willing to perform his part of the contract, he is not entitled to get a decree for specific performance. According to counsel, readiness should be real and willingness should be genuine and as such, it should be backed up by the capacity to perform the essential terms of the contract. 10. Question as to whether plaintiff was ready and willing to perform his part of the contract is a question of fact to be inferred from the facts and circumstances of each case. Supreme Court in Ramesh Chandra v. Chunilal AIR 1971 SC 1238 held that readiness and willingness could not be treated as a strait jacket formula. These have to be determined from the entirety of facts and circumstances, relevant to the intention and conduct of the party concerned. The substance of the matter and the surrounding circumstances and the conduct of the plaintiff must be taken into consideration in adjudging readiness and willingness on the part of the plaintiff to perform his part of the contract. Supreme Court in His Holiness Acharya Swami Ganesh Dassji v. Sita Ram Thapar (1996) 4 SCC 526 held as follows: "There is a distinction between readiness to perform the contract and' willingness to perform the contract. B y readiness may be meant the capacity of the plaintiff to perform the contract which includes his financial position to pay the purchase price. For determining his willingness to perform his part of the contract, the conduct has to be properly scrutinised. The factum of readiness and willingness to perform plaintiffs part of the contract is to be adjusted with reference to the conduct of the party and the attending circumstances. For determining his willingness to perform his part of the contract, the conduct has to be properly scrutinised. The factum of readiness and willingness to perform plaintiffs part of the contract is to be adjusted with reference to the conduct of the party and the attending circumstances. The Court may infer from the facts and circumstances whether the plaintiff was ready and was always ready and willing to perform his part of the contract." 11. As held by the Supreme Court, the factum of readiness and willingness to perform plaintiffs part of the contract is to be adjudged with reference to the conduct of the party and the attending circumstances. In the instant case, plaintiff expressed his readiness and willingness to perform his part of the contract in his lawyer notice, Ext. A2 dated 25.10.1993, before the expiry of the period fixed in Ext. Al. Ext. A2 shows that he had expressed his readiness and willingness even before the issuance of the lawyer notice. Inspite of the above statement of the plaintiff in Ext. A2, there was no reply from defendants 1 and 2. 12. In the plaint also plaintiff has categorically stated that he is ready and willing to perform his part of the contract. Even then defendants 1 and 2 did not raise any specific issue before the trial court to decide as to whether the plaintiff was ready and willingness to perform his part of the contract. In the above mentioned circumstances, we are of the view that trial Court is justified in taking the view that plaintiff was ready and willing to perform his part of the contract and continued to be so. 13. Counsel for defendants 1 and 2 however contended that even if Ext. Al was a valid agreement, and the plaintiff was ever ready and willing to perform his part of the contract, this Court shall not exercise its discretionary jurisdiction to decree the suit for specific performance. Counsel pointed out that this Court's jurisdiction is discretionary and this Court is not bound to grant such a decree, merely because it is lawful to do so. Counsel contended that first defendant is a widow and her son is also no more. She has no house to reside. Various terms and conditions of the agreement were also impossible of compliance. Counsel contended that first defendant is a widow and her son is also no more. She has no house to reside. Various terms and conditions of the agreement were also impossible of compliance. Counsel submitted much hardship would be caused to defendants 1 and 2 rather than to the plaintiff if Ext. Al is given effect to. 14. In view of the above mentioned contention, we have to examine as to whether this court should exercise its discretionary jurisdiction and uphold the decree for specific performance passed by the trial court. In this connection, it is relevant to refer to S.20 of the Specific Relief Act, which is extracted below: "20 Discretion as to decreeing specific performance: (1) The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so, but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal. (2) The following are cases in which the court may properly exercise discretion not to decree specific performance (a) Where the terms of the contract or the conduct of the parties at the time of entering in to the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plain tiff an unfair advantage over the defendant; or (b) Where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its non-performance would involve no such a hardship on the plaintiff; (c) Where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance. Explanation. l- Mere inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of Clause (a) to hardship within the meaning of clause (b). Explanation 2 - The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff, subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract. Explanation 2 - The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff, subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract. (3) The Court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance. (4) The Court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the other party." S.20(1) provides that the jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so, but the discretion of the court is not to be exercised arbitrarily. Even though the latter part of S.20 enumerates certain principles, which the Court should take into consideration in exercising discretion, the same is not exhaustive. One principle that may always guide the Court while exercising its discretion is that it shall not act in an inequitable manner. 15. Supreme Court in Sardar Singh v. Krishna Devi, (1994) 4 SCC 18, while reminding that the relief for specific performance is discretionary, held that the court would take into consideration the circumstances in each case, the conduct of the parties and the respective interest in the contract while exercising its jurisdiction. Supreme Court in Kanshi Ram v. Om Prakash Jawal, (1996) 4 SCC 593 held that it is equally settled law that granting decree for specific performance of a contract of immovable property is not automatic. It is one of discretion to be exercised on sound principles. When the court gets into equity jurisdiction, it would be guided by justice, equity, good conscience and fairness to both the parties. Therefore, when the court exercises its discretionary jurisdiction, the court has to exercise the same on sound judicial principles and not arbitrarily. 16. We have to analyse the case on hand on the basis of the judicial principles laid down by the Supreme Court. In the instant case, we have found that Ext. Al is a valid agreement for sale. Therefore, when the court exercises its discretionary jurisdiction, the court has to exercise the same on sound judicial principles and not arbitrarily. 16. We have to analyse the case on hand on the basis of the judicial principles laid down by the Supreme Court. In the instant case, we have found that Ext. Al is a valid agreement for sale. We have also found that plaintiff was ever ready and willing to perform his part of the contract. Plaintiff also sent a lawyer notice to defendants 1 and 2 informing them that he was ever ready and willing to perform his part of the contract. Defendants 1 and 2 did not send any reply to the lawyer notice. Defendants 1 and 2 though agreed to evict the possessory mortgagee and the tenants from the plaint schedule property, they did not do so. Plaintiff made them parties to the suit. Even though they entered appearance, they did not file any written statement and contested the suit. Defendants 1 and 2 have got a case that first defendant is a widow and her son is also no more. However, it is to be noted that defendants 1 and 2 are co-owners of plaint schedule property, and second defendant is none other than the brother of the first defendant. Second defendant is a tailor by profession for more than 25 years. It has also come out in evidence that he had gone abroad in the year 1975 for better prospects and came back two years later. Evidence also shows that defendants 1 and 2 are not residing in the plaint schedule property, and they are residing elsewhere. First defendant has also not come forward to give evidence. 17. On the other hand, plaintiff submits that he has no residential house of his own. He is a tailor by profession, and he wanted to purchase the plaint schedule property after getting the mortgagee and the tenants evicted from the plaint schedule property, so that he could reside there. Plaintiff further submits that he is residing in a house which is mortgaged to him for Rs. 75,000/- and the owners are compelling him to vacate the house. 18. In these circumstances, we are convinced that plaintiff had entered into Ext. Al agreement with bona fide intention to purchase the property so that he can reside there. Plaintiff further submits that he is residing in a house which is mortgaged to him for Rs. 75,000/- and the owners are compelling him to vacate the house. 18. In these circumstances, we are convinced that plaintiff had entered into Ext. Al agreement with bona fide intention to purchase the property so that he can reside there. Court below also after judging the demean our of the witnesses has come to the conclusion that the suit has to be decreed. We do not find any reason to disturb the suit finding. 19. We, therefore, uphold the judgment and decree of the trial court. However, we make it clear that it would be the responsibility of the plaintiff to get defendants 3 and 4 and defendants 5 to 8 evicted if he so desires. Plaintiff may inform defendants 1 and 2 a convenient date for execution of the sale deed. On receipt of the said notice, defendants 1 and 2 would execute the sale deed on the said date or on a mutually agreed date, however, within a period of two months from the date of the judgment. Needless to say, defendants 1 and 2 would give credit to the amount already received by them. The appeal is accordingly dismissed. However, considering the facts and circumstances of the case, we direct the parties to bear their respective costs.