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2002 DIGILAW 1033 (AP)

Are Venkateswarlu v. Matupalli Anjaneyulu

2002-08-23

DALAVA SUBRAHMANYAM

body2002
J U D G M E N T The appellant-plaintiff filed the appeal against the decree and judgement dated 23.1.1991 in A.S.No. 52 of 1989 on the file of the Subordinate Judge, Kavali in allowing the appeal and setting aside the decree and judgement dated 30.6.1989 in O.S.No.299 of 1984 directing the defendants to refund Rs.4,500 being the sale consideration with future interest. 2. The brief facts leading to the filing of the second appeal are as follows: 3. The appellant-plaintiff Are Venkateswarlu filed O.S.No. 299 of 1984 on the file of the Principal District Munsif, Kavali for specific performance of an agreement of sale dated 27.3.1983 and for costs. The plaintiff contended that the Ist defendant as Manager of the Hindu Joint Family executed an agreement of sale dated 27.3.1983 for a sum of Rs. 8,500/- after receiving an amount of Rs. l,000/- towards advance. As per the terms and conditions of the sale agreement, the balance of sale consideration of Rs. 7,500/- should be paid on or before 27.4.1983 and the plaintiff has to get the registered sale deed executed. The 2nd defendant received a sum of Rs. 3500/- from the plaintiff on 27.4.1983 towards balance of sale consideration and executed a letter dated 27.4.1983. The defendants delivered copies of two sale deeds evidencing their title and delivered possession of 27.4.1983. The defendants represented that they had to go to Hyderabad and they would execute the sale deed after their return inspite of several demands, the defendants failed to receive the balance of sale consideration and execute the sale deed. The plaintiff was always ready and willing to perform his part of the contract and he got issued a registered notice dated 28.5.1984 for which the defendant gave false reply. Hence the suit. 4. The defendants filed written statement admitting the execution of the sale agreement dated 27.3.1983 and the amounts received towards sale consideration. The defendants denied having delivered possession of the suit property. The plaintiff never approached the defendants to get the sale deed executed. The letter dated 27.4.1983 was brought into existence with an ulterior motive. The plaintiff having committed breach of contract and having failed to perform his part of contract within the time stipulated, he is not entitled for any relief. Hence the suit may be dismissed. 5. On the above said pleadings, the following issues were framed and settled for trial. 1. The plaintiff having committed breach of contract and having failed to perform his part of contract within the time stipulated, he is not entitled for any relief. Hence the suit may be dismissed. 5. On the above said pleadings, the following issues were framed and settled for trial. 1. Whether the plaintiff is entitled to the specific Performance of the agreement of sale deed dated 27-3-1983? 2. Whether the plaintiff is in possession of the plaint schedule property? 3. Whether time is not the essence of the contract? 4. Whether the letter dated 20.2.1984 is true. valid and binding on the defendants? 5. To what relief? 6. On behalf of the plaintiff Pws 1 to 4 were examined and Ex.A1 to A5 were marked. On behalf of the defendants DW1 was examined and Ex.X1 to X4 were marked. After appreciating the oral and documentary evidence, the trial Court found the issues I to 3 in favour of the plaintiff and decreed the suit as prayed for. Aggrieved against the decree and judgement, the defendants filed A.S.No. 52 of 1989 on the file of the Subordinate Judge, Kavali and the learned Subordinate Judge, Kavali came to the conclusion that time was essence of the contract and the plaintiff committed breach of contract and therefore he is not entitled to specific performance and allowed the appeal and directed the defendants to refund the balance of sale consideration with interest. 7. Aggrieved against the decree and judgement, the plaintiff filed the second appeal contending that the decree and judgement of the lower appellate Court is contrary to law and weight of evidence and probabilities of the case and the lower Court committed gross error in reversing the decree and judgement of the trial Court. The lower appellate Court erred in coming to the conclusion that the time was essence of the contract. 8. Now the following substantial questions of law would arise for consideration in the second appeal. 1. Whether the lower appellate Court committed error in coming to the conclusion that time was essence of the contract and the plaintiff committed breach of contract? 2. Whether one of the parties to the agreement of sale can repudiate the agreement unilaterally without prior notice to other side? 9. Points I and 2:- The appellant-plaintiff filed suit for specific performance of the agreement of sale dated 27.3.1983. The plaintiff is examined as Pw-1. 2. Whether one of the parties to the agreement of sale can repudiate the agreement unilaterally without prior notice to other side? 9. Points I and 2:- The appellant-plaintiff filed suit for specific performance of the agreement of sale dated 27.3.1983. The plaintiff is examined as Pw-1. It is in the evidence of Pw-1 that the defendants executed an agreement of sale for Rs. 8,500/- under Ex.A1 and on the date of execution of Ex.A1 he paid an advance of Rs.1,000/- and he had to pay the balance of sale consideration within one month. On 27.4.1983 he paid Rs. 3.500/-and Ist defendant executed a letter Ex.A2 and subsequently they postponed the execution of the sale deed and he issued a registered notice. Pw-2 is a person who negotiated the sale. He deposed with regard to the suit transaction. Ex.X1 is the letter written by 1st defendant to him. He also wrote a letter to the 1st defendant and Ex.A2 is the office copy of the said letter. Pw-3 is the surpanch of Gudavalur and he deposed with regard to the suit transaction and the execution of Ex.A2. Pw-2 paid house tax and Ex.A5 is the house tax receipt. Pw-4 is the surpanch and President of the Society who also deposed with regard to the suit transaction. He also mediated and 1st defendant agreed that he would execute the sale deed. The 1st defendant, who is examined as Dw-1, admitted the execution of Ex.AI agreement and the receipt of advance of Rs.1,000 and part payment of Rs. 3,500/- on 27.4.1983. Ex.A2 is also admitted by the 1st defendant. 10. The execution of the suit agreement marked as Ex.A1 is admitted. As per the terms and conditions under Ex.A1 the balance of sale consideration had to be paid on or before 27.4.1983. The intention of the parties had to be gathered from the recitals under Ex.A1. There is no recital that in case the balance of sale consideration was not paid on or before 27.4.1983, the agreement stood cancelled or the plaintiff was not entitled to the amounts paid. The defendants did not give any notice directing the plaintiff to perform his part of contract. On 27.4.1983, the Ist defendant received a sum of Rs. There is no recital that in case the balance of sale consideration was not paid on or before 27.4.1983, the agreement stood cancelled or the plaintiff was not entitled to the amounts paid. The defendants did not give any notice directing the plaintiff to perform his part of contract. On 27.4.1983, the Ist defendant received a sum of Rs. 3,500/- towards part of the sale consideration and acknowledged under Ex.A2, but there is no recital either extending time or directing the plaintiff to pay the balance of sale consideration within a particular period. On considering the recitals under Ex.A1 and A2, it is clear that the parties intended that time was not the essence of the contract. There are no recitals in the documents specifying the-time limit for performing the contract. When the Ist defendant received part of the sale consideration on 27.4.1983, he did not protest or specify any time limit for performing the contract. On the other hand, Pws 2 to 4, who are independent witnesses, deposed that the parties agreed to execute the sale deed as and when the balance of sale consideration was paid to the defendants. The defendants never issued any notice directing the plaintiff to perform his part of the contract, or repudiate the contract at any time. It is only after giving notice by the plaintiff, the defendants gave a reply under Ex.A4. The agreement should provide the time for performance of the contract and when the agreement is silent, it is deemed that the time is not essence of the contract. Neither the terms of agreement nor the correspondence indicate that the parties treated time as essence of contract. For the above said reasons, the trial Court rightly came to the conclusion that the time was not essence of the contract and the plaintiff never committed any breach of contract and hence the plaintiff was entitled to the specific performance of the contract. The lower appellate Court committed an error in coming to the conclusion that the plaintiff having paid only part of the sale consideration on 27.4.1983, he was not ready and willing to pay the entire sale consideration. When time is not essence of the contract, there is no question of paying the entire sale consideration at one time and in fact the Ist defendant received part of sale consideration on 27.4.1983 without any protest, which is not disputed. When time is not essence of the contract, there is no question of paying the entire sale consideration at one time and in fact the Ist defendant received part of sale consideration on 27.4.1983 without any protest, which is not disputed. Thus the lower appellate Court committed error in coming to the conclusion that the plaintiff got issued legal notice at a belated stage. It is in the evidence of Pws.1 to 4 that they have been negotiating with the defendants to execute the sale deed and having failed in their attempts, the plaintiff got issued a legal notice. The intention of the parties would prove that time was not the essence of the contract and in fact the Ist defendant received part payment of Rs. 3.500/- on 27.4.1983 and executed Ex.A2 letter which would prove that time was not essence of the contract and the defendants never gave any notice to the plaintiff directing him to perform his part of the contract and therefore the plaintiff is entitled to the relief of specific performance of the contract. Hence the lower appellate Court is not justified in observing that the plaintiff did not come to the Court with clean hands. For the above said reasons, the lower appellate Court committed error in coming to the conclusion that time was essence of the contract and that the plaintiff committed breach of contract. There are no tenable grounds to set aside the findings of the trial Court and the lower appellate Court committed error in coming to the conclusion that the plaintiff was not entitled to the relief of specific performance and hence the decree and judgement in A.S.No. 52 of 1989 dated 23.1.1991 is liable to be set aside. For the above said reasons, the second appeal is liable to be allowed. In the result, the second appeal is allowed with costs through out and the decree and judgement in A.S.No. 52 of 1989 dated 23.1.1991 on the file of the Subordinate Judge is set aside and the decree and judgment in O.S.No. 299 of 1984 dated 30.6.1989 on the file of the Principal District Munsif, Kavali is restored. --X--