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2009 DIGILAW 118 (DEL)

Shakuntala Bholla v. Sheel Chand Jain

2009-01-29

SHIV NARAYAN DHINGRA

body2009
1. This suit has been filed by the plaintiff for specific performance of an agreement to sell dated 1st September 2003. 2. Brief facts relevant for the purpose of deciding this suit are that the plaintiff had entered into an entered agreement to purchase the 3rd floor of the property build on a piece of land measuring 200 sq. yards at the premises bearing number 45/12, East Patel Nagar, Delhi. The consideration, as agreed between the parties, was Rs.25 lacs. A sum of Rs.2 lac was paid by the plaintiff at the time of entering into the agreement and Rs.1 lac was to be paid by 29th September 2003 and remaining Rs.22 lacs was to be paid by 31st January 2004 and on receipt of this payment, the defendant was to execute a sale deed in respect of the third floor in favour of the plaintiff. The plaintiffs contention is that she approached the defendant on 29th September 2003 with payment of Rs. one lac but the defendant stated that he does not need the payment on that day and he would inform the plaintiff whenever this payment would be needed by him. It is pleaded by the plaintiff that on 10th November 2003, defendant informed her that part payment of Rs.1 lac be made to him and accordingly plaintiff made payment of Rs.1 lac to the defendant on 11th November 2003 against receipt. The plaintiff also demanded photocopies of the title documents of the property from the defendant on that day, which he promised to supply in the first week of January 2004 However, copies of the title documents were never supplied by the defendant despite demands made regularly by the plaintiff. Defendant was also required to clear all dues and arrears relating to electricity charges, house tax etc outstanding up to 31st January 2004 Defendant did not supply the documents showing clearance of arrears or the copies of the title documents. On 28th January 2004, the Plaintiff went to the defendant and demanded those documents so that a draft sale deed could be prepared and be shown to the defendant. However, defendant became very rude to the plaintiff and refused to supply the documents and did not give any specific reply. On 28th January 2004, the Plaintiff went to the defendant and demanded those documents so that a draft sale deed could be prepared and be shown to the defendant. However, defendant became very rude to the plaintiff and refused to supply the documents and did not give any specific reply. Apprehending mala fide intentions, the plaintiff sent a notice dated 29th January 2004 to the defendant through her advocate calling upon him to complete the transaction by or before 31st January 2004 The notice was received by the defendant on 30th January 2004 However, the defendant did not comply with the demands made in the notice, rather defendant sent a notice dated 2nd February 2004 falsely stating that the plaintiff had failed to pay the balance consideration of Rs.22 lac on or before 31st January 2004 so the amount of Rs. three lac, already paid by the plaintiff to the defendant, stood forfeited. The defendant intentionally did not refer to the notice of the plaintiff, though received by him. 3. Plaintiff submitted that she was the owner of the first floor of the property No.816, Vasant Kunj, New Delhi but since she was a widow and had two children, she wanted to live near the house of her parents at West Patel Nagar, Delhi. She, therefore, had planned to sell her property at Vasant Kunj in order to purchase the property in question. She had received sale consideration of her flat at Vasant Kunj on 21st January 2004 and there was tremendous pressure on her to purchase the suit property and there was no reason for her not to be interested in purchase of the suit property. She had entered into the agreement dated 1st September 2003 only with a view to purchase the property in question after sale of her flat at Vasant Kunj. She was not looking for any other property, therefore, the question of her not being ready and willing to purchase the property in question did not arise and the allegations made by the defendant were false. She had always been ready and willing to make the balance payment of Rs.22 lacs and performing her part of the contract but it was the defendant who refused to perform his part of the contract. She had always been ready and willing to make the balance payment of Rs.22 lacs and performing her part of the contract but it was the defendant who refused to perform his part of the contract. She claimed that she was entitled to the specific performance of the agreement dated 1st September 2003 and defendant was under an obligation to execute and register the sale deed qua this property and to hand over the vacant possession to her. She stated, in the alternative, she was entitled to receive double the amount of earnest money i.e. Rs.6 lac. However, she stated that she was insisting upon the main relief of specific performance. 4. In the written statement, defendant admitted having entered into the agreement to sell qua the property in question with the plaintiff, however, stated that the agreement was signed only by the plaintiff and the defendant and not by the attesting witnesses and the signatures of witnesses appearing on the original agreement to sell filed by the plaintiff were obtained by the plaintiff later on. A copy of the agreement entered between the parties, as available with the defendant does not bear the signatures of the witnesses. He, therefore, submitted that since the signatures of these witnesses were obtained later on, the agreement was a forged document and null and void. He also took the stand that it was the plaintiff who had not fulfilled her part of the obligations under the agreement. Therefore, he had a right to forfeit the earnest money and rescind the agreement. It was denied that on 29th September 2003 plaintiff had approached the defendant for payment of Rs. one lac and defendant stated that he did not need money on that day and would inform the plaintiff whenever the amount was needed by him. He submitted that no such amount was tendered to him on 29.09.2003 and the amount was paid belatedly on 11th November 2003. The defendant accepted the amount in order to avoid unnecessary controversy and litigation and also he had always been ready and willing to abide by the agreement. He denied having informed the plaintiff on 10th November 2003 that he needed money as is alleged. The defendant accepted the amount in order to avoid unnecessary controversy and litigation and also he had always been ready and willing to abide by the agreement. He denied having informed the plaintiff on 10th November 2003 that he needed money as is alleged. It was also denied that on 11th November 2003 any demand for photocopies or title documents were made and the defendant promised to supply her the same in the first week of January 2004 or that these photocopies were never supplied to the plaintiff. He submitted that copies of the title documents were supplied to the plaintiff at the time of signing the agreement to sell itself and all necessary particulars about the title of the property were clearly mentioned in the recitals of the agreement itself showing that the defendant had supplied copies of all the documents including documents regarding conversion of the property from leasehold to freehold. Thus, there was no issue of furnishing any other documents to the plaintiff nor such documents could be demanded by the plaintiff. The plaintiff racked up this issue in the alleged notice and plaint with ulterior motives since she was not ready and willing to perform her part of the agreement. She did not tender the balance consideration or take any steps towards the execution of the sale deed. It is submitted that defendant had cleared all pending bills. Even otherwise, the liabilities to clear all charges and taxes up to the date of execution of the sale deed was that of the defendant, therefore, plaintiff had no reason to avoid balance payment and get the sale deed registered on this ground. The plaintiff had copies of title deeds. If she wanted, she could have got the sale deed prepared and made payment of the balance consideration to the defendant and get the property transferred in her name. However, instead of doing this, she allegedly served a vague notice on the defendant accusing the defendant of non compliance of his part of the agreement. Notice dated 29th January 2004 was not received by the defendant, the plaintiff became dubious. She did not have sufficient funds to pay the balance amount and, therefore, was not ready and willing to perform her part of the agreement but by serving notice she wanted to show converse. Notice dated 29th January 2004 was not received by the defendant, the plaintiff became dubious. She did not have sufficient funds to pay the balance amount and, therefore, was not ready and willing to perform her part of the agreement but by serving notice she wanted to show converse. It is submitted that since the agreement to sale deed was to be executed on 31st January 2004 before the Sub Registrar, Janakpuri, the defendant reached the office of Sub Registrar, Janakpuri at 10 am for this purpose and stayed there till 1 pm but the plaintiff did not turn up at all and as a result the sale deed could not be executed. 5. It is pleaded by the defendant that the plaintiff did not have funds to pay the balance amount of sale consideration and, therefore, she was not ready and willing to perform her part of the agreement within the period stipulated in the agreement and the defendant, therefore, became entitled to aforesaid amount of Rs.3 lac. The defendant rescinded the agreement only after the time, as given in this agreement for execution of the sale deed, had expired and no balance consideration was tendered by the plaintiff. Defendant also served notice dated 2nd February 2004 to this effect on the plaintiff. All other allegations made by the plaintiff were denied by the defendant. 6. On pleading of parties following issues were framed on 8th August 2005: 1. Whether the agreement in question was not signed by the witnesses on 01.09.2003 If so, its effect. OPD. 2. Whether the plaintiff has been ready and willing to perform her part of the said agreement OPP 3. Whether the plaintiff demanded the copies of title documents of the suit property from the defendant on 28.01.2004 and whether the defendant failed to supply the same OPP 4. Whether the plaintiff served the notice dated 29.01.2004 on the defendant OPP 5. Whether the defendant had terminated the said agreement vide notice dated 02.02.2004 OPD 6. Whether the suit for specific performance simplicitor is maintainable OPP 7. Whether no cause of action has arisen to the plaintiff OPD 8. Whether the suit has been verified as per Order 6 Rule 15 CPC OPP 9. Relief. 7. ISSUE NO.1: Much emphasis has been laid on this issue. Whether the suit for specific performance simplicitor is maintainable OPP 7. Whether no cause of action has arisen to the plaintiff OPD 8. Whether the suit has been verified as per Order 6 Rule 15 CPC OPP 9. Relief. 7. ISSUE NO.1: Much emphasis has been laid on this issue. It is submitted by counsel for defendant that the two copies of the agreements were prepared at the time when agreement dated 1st September 2003 was entered into and the copy retained by the defendant did not contain the signatures of the witnesses which were in the original agreement filed by the plaintiff. The two witnesses namely Mr. T.Kumar and Mr. Mahesh Motwani were not at all present at the time of execution of the agreement and they were introduced by the plaintiff by herself. Thus the agreement was a forged agreement. I consider that this contention of the counsel for the defendant must fail. The original agreement records as under: In witness whereof This Agreement is made at New Delhi in the presence of following witnesses, and the parties and witnesses have also signed this agreement with their sound mind, good health without force any side and also without the influence of intoxicants 8. Although the presence of the witness is of no importance since the agreement to sell is not required to be mandatorily attested by the witnesses and an agreement to sell entered into between plaintiff and defendant is a valid document even if it is not signed by the witnesses but in this case, when the defendant signed the agreement, he himself recorded in the agreement that the agreement had been signed in presence of witnesses and the parties with their sound minds and good health. It cannot be believed that the defendant signed the agreement without witnesses and still recorded that he was signing the agreement before the witnesses. I, therefore, consider that the agreement has to be considered having been signed in presence of the witnesses. It is settled law that if a duly signed written document exists, no amount of oral evidence can be entertained which is contrary to written clauses. This issue is, therefore, decided in favour of the plaintiff and against the defendant. .9. ISSUE NO.3: Whether the plaintiff demanded copies of the title documents from the defendant on 28th January 2004 or not is of no consequence. This issue is, therefore, decided in favour of the plaintiff and against the defendant. .9. ISSUE NO.3: Whether the plaintiff demanded copies of the title documents from the defendant on 28th January 2004 or not is of no consequence. However, testimony of plaintiff about this demand does not inspire confidence. It is admitted by her that this deal qua the property in question was made through a property dealer. The agreement to sell relied upon by her and the receipt contains signatures of the property dealer. In fact whenever a property deal is done through a property dealer, the property dealer gets commission/ brokerage from both sides and it is the interest of the property dealer that the deal gets through as his brokerage is always linked with the payment. It is not the case of the plaintiff that she had paid any advance brokerage to the property dealer. Therefore, the property dealer would have been very much interested to see that this deal must go through and he gets the brokerage. It is admitted by the plaintiff in her testimony that at the time of entering into the agreement to sell, the defendant had given the photocopy of the title documents to the property dealer. I find no reason why the defendant would have given only the first page of the title deed as is alleged and why the plaintiff would not demand to see that the entire documents with respect to the title of the defendant before entering into the deal more so when she was accompanied by her brother who is a businessman and is running a jewellery showroom. It cannot be believed that she entered into the deal without verifying the title of the defendant. It also cannot be believed that defendant would withhold the copies of the title deeds or would not have provided the same to her or to the property dealer. It has come in the testimony of the plaintiff, during cross examination, that one original copy of the agreement to sell was prepared only and the second copy was prepared by the property dealer immediately by photocopying. That would only show that the property dealer was having a photocopying machine in his office and he prepared the photocopy of the agreement to sell and handed over the original to the plaintiff and a photocopy duly signed by the parties to the defendant. That would only show that the property dealer was having a photocopying machine in his office and he prepared the photocopy of the agreement to sell and handed over the original to the plaintiff and a photocopy duly signed by the parties to the defendant. If this could be done in respect of the agreement to sell, there seems to be no reason why the property dealer would not have prepared the photocopy of the title deeds also immediately and given a copy of the title deeds to the plaintiff. Plaintiff has alleged that she contacted the property dealer at least 100 times demanding copies of the title deeds. However, she had not called Mr. Motwani, the property dealer, into the witness box. He was an independent witness and would have been the best person to depose in this case about the deal and on the issue as to because of which party, this deal did not go through. His non examination by the plaintiff throws doubt upon her version that she was not supplied copies of the title deed. This is also clear from her statement in cross examination when she was asked as to why she did not come to Sub-Registrars office, she stated that she had not visited the office of Sub Registrar on 31st January 2004 since she had no talks with the defendant. However, in next answer she stated that she had not visited the office of Sub Registrar since she had talked with the defendant on 26/27th January 2004 and the defendant had told her not to visit the office of the Sub Registrar on 31st January 2004 This goes contrary to her stand taken in the plaint that she visited the defendant on 28th January 2004, who talked to her rudely (cross examination conducted on 1st April 2006) and refused to hand over the copies. If she had visited defendant on 26/27th January 2004 with her brother, and defendant had told her to talk to him after 31st January 2004, there was no reason for her to go to defendant on 28th January 2004 for demanding copies. 10. All this story put forth by the plaintiff about her going to defendant on 28th January 2004 for demanding copies of the documents even otherwise seems to be totally false and unbelievable. 10. All this story put forth by the plaintiff about her going to defendant on 28th January 2004 for demanding copies of the documents even otherwise seems to be totally false and unbelievable. A person whose last date of execution of the sale deed is 31st January 2004 would take care of it that he or she has the copies of the documents with him well in advance and gets the sale deed prepared in consultation with the defendant. In normal course, before finalization of the sale deed, a draft sale is prepared well in advance and ii finalized by the parties by mutual discussion. In view of foregoing circumstances, I hold this issue against the plaintiff and in favour of the defendant. The issue is decided accordingly. 11. ISSUE NO.4 : Nothing turns on this issue. Even if it is believed that the plaintiff served a notice dated 29th January 2004, such a notice would have no effect. The last date for execution of the sale deed was 31st January 2004 Normally, service of a registered notice through postal department takes around three days. If she had sent a notice on 29th January 2004, in normal course, it would have reached the defendant after 31st January 2004 She has placed on record the postal receipt showing dispatch of notice on 29th January 2004 and an AD card has been placed on record which does not bear the signatures of defendant. It is admitted by her that the signatures on AD card were not that of the defendant. The defendant has denied receipt of this notice. Plaintiff had not examined the postal authorities to prove that the notice was delivered to the defendant on 30th January 2004 as is alleged by her. She could have easily obtained a certificate from the Postal Department as to when this notice was served on the defendant. In view of non examination of a witness from Postal Department and in view of the admission of the plaintiff that the AD Card did not bear the signature of defendant, it cannot be said that notice dated 29th January 2004 was duly served upon the defendant, though it might have been posted by the plaintiff. The issue is decided accordingly. 12. ISSUE NO.2: The plaintiffs contention is that she had all along been ready and willing to perform her part of the agreement. The issue is decided accordingly. 12. ISSUE NO.2: The plaintiffs contention is that she had all along been ready and willing to perform her part of the agreement. She was in dire need of the premises. She had even sold her property situated at Vasant Kunj in order to purchase this property. However, her action and the testimony do not support her contention. She had paid Rs.2 lac at the time of entering into the agreement and in terms of the agreement; she was to pay another sum of Rs.1 lac by 29th September 2003. She claimed that she had gone to pay this amount in cash to the defendant on 29th September 2003 but defendant told her that he was not in need of money, therefore, he did not take this money. He told her that he would inform her as to when this amount of Rs. one lac is to be paid. Later on, he gave telephone call on 10th November 2003 informing her to pay the money, so on 11th November 2003, she paid this money to him. .13. This deal was in respect of the sale of the property, there was no hitch in accepting the money whether the defendant needed the same or not. Once she had gone to the house of defendant, she could have told defendant that she would not take the money back and he should accept the same immediately. The receipt (Ex.P2) would show that this receipt was prepared well in advance, hoping that money would be paid on 29th September 2003 and when money was paid on 11th November 2003, the date of 29th .September 2003 was scored off by pen and the date of 11th November 2003 was inserted in place of this date. It is obvious that this receipt was not prepared on the day when the money was delivered but this receipt was prepared on the date when the agreement to sell was executed. This receipt bears the signatures of Mr. Motwani, the property dealer, as a witness. There is no occasion for his signatures to be there on the receipt since as per the evidence, he was not present at the time when Rs.1 lac was handed over. This receipt bears the signatures of Mr. Motwani, the property dealer, as a witness. There is no occasion for his signatures to be there on the receipt since as per the evidence, he was not present at the time when Rs.1 lac was handed over. Appearance of his signatures on the receipt would only show that this receipt was prepared well in advance and signed in advance by the witness and was to be signed by the defendant only when the payment was received by him. Since the defendant received the payment on 11th November 2003, he signed the receipt on 11th November 2003. Had the payment been offered on 29th September 2003, the defendant would have signed the receipt on 29th September 2003, the date mentioned in the receipt and received the payment. There are contradictions in the testimony of plaintiffs witnesses. While plaintiff had stated that defendant took the plea that the defendant refused to receive Rs. One Lac on the ground that he did not need money on that day, the testimony of plaintiffs brother is that defendant was busy on 29th September 2003 and he telephonically told that he would receive the payment later on when he needed the same. Neither it is pleaded by the plaintiff in the plaint nor it is her testimony that defendant had stated that he was busy. It only reveals that plaintiff had no money with her on 29th September 2003. If she had money in her account, she could have sent a cheque to the defendant by post and if he had cash, there was no reason for defendant to refuse the payment. This conduct of the plaintiff would also show that it was she who was not ready and willing to perform her part of contract. As per the agreement, all bills of electricity and water charges and house tax were to be cleared by the defendant before entering into the sale deed. She had not bothered to check whether electricity or water bills etc had been cleared or not. She had not bothered to check whether property tax had been cleared or not. She had not asked defendant at any point of time to furnish her the copies of paid electricity and water bills and house tax bills. She had not bothered to check whether electricity or water bills etc had been cleared or not. She had not bothered to check whether property tax had been cleared or not. She had not asked defendant at any point of time to furnish her the copies of paid electricity and water bills and house tax bills. She had been harping on, only one point that she had demanded copies of title deeds from the defendant and defendant refused to supply the copy of title deeds to her. While adjudicating issue No.2, I have already held that this plea of the plaintiff seems to be false. 14. During cross examination, a specific question was put to the plaintiff whether the defendant at any point of time refused to execute the sale deed. She categorically stated that defendant had not refused to execute the sale deed. Her plea is that the defendant was avoiding execution of the sale deed but she had not given proof of defendants avoiding execution of the sale deed. In fact, it seems that the plaintiff had been avoiding the execution of the sale deed and had not contacted the defendant or the property dealer after 11.11.2003. When the plaintiff saw that her time was running out, she contacted some advocate and made up a story of demand of photocopies and sent a notice on 29th January 2004 to the defendant making allegations against the defendant that he had not supplied the photocopies of the documents to her. In order to execute the sale deed, she was supposed to purchase the stamp papers and she was supposed to fix time of reaching to the Sub Registrars Office with the defendant. She was supposed to prepare a draft sale deed and consult the defendant for approval of the sale deed. She was also supposed to contact the property dealer and would have asked the property dealer to facilitate execution of the sale deed. In normal course of business wherever a property dealer is involved in the sale purchase of the property, the property dealer always takes the responsibility of getting the sale deed executed between the parties. He finalizes the sale deed in consultation with parties and then taking them to Sub Registrars Office from a common meeting point. In normal course of business wherever a property dealer is involved in the sale purchase of the property, the property dealer always takes the responsibility of getting the sale deed executed between the parties. He finalizes the sale deed in consultation with parties and then taking them to Sub Registrars Office from a common meeting point. Non examination of property dealer throws a grave doubt on the case of the plaintiff that she was always ready and willing to execute the sale deed. .15. No doubt that the plaintiff is a widow and there is no denying of the fact that she deposed that she wanted to purchase a house in the vicinity of her parents but she has not come with evidence to show that she had done necessary acts or her part to show her readiness to purchase this property. The defendant was only supposed to receive the sale consideration before the Sub Registrar and sign the sale deed of this property in favour of the plaintiff and hand over the original title deeds and the possession to the plaintiff. The purchase of stamp duty for preparation of the sale deed, keeping draft of the balance consideration ready, fixing of time with defendant for appearance before the Sub Registrar etc, was all to be done by the plaintiff. Plaintiffs contention does not inspire confidence that she had been ready and willing to execute the sale deed before 31st January 2004 If we believe her testimony that she contacted the defendant on 26/27.1.2004 and defendant asked her to meet after 31st January 2004, she should have asked the defendant to extend the time of execution of the sale deed and she should have contacted the property dealer also to ask property dealer for extension of time from the defendant for execution of the sale deed. She had not contacted the property dealer for extension of time or for execution of the sale deed. In fact she got a notice issued through an advocate to put the blame on the defendant, when actually there was no fault on the defendants part. I, therefore, come to conclusion that the plaintiff was not ready and willing to perform her part of the contract. The issue is accordingly decided in favour of the defendant and against the defendant. 16. I, therefore, come to conclusion that the plaintiff was not ready and willing to perform her part of the contract. The issue is accordingly decided in favour of the defendant and against the defendant. 16. ISSUE NO.5: It is the admitted case of the parties that the defendant had sent a notice dated 2nd February 2004 (Ex.PW1/7) stating therein that the plaintiff has not complied with the terms of the agreement and the agreement stood automatically revoked/terminated. This issue is accordingly decided in favour of the defendant and against the plaintiff. 17. ISSUE NO.6: This objection taken by the defendant seems to be a frivolous objection. A suit for specific performance of an agreement between the parties and in the alternative for damages is maintainable. There is no ground why such a suit is not maintainable. The issue is accordingly decided in favour of the plaintiff and against the defendant. 18. ISSUE NO.7: Plaintiff filed this suit on the ground that it was defendant who wrongfully terminated the agreement and she alleged that she had always been ready and willing to perform her part of the agreement. On the basis of allegations made by her in the plaint, prima facie a cause of action exists in favour of the plaintiff. The issue is accordingly decided in favour of the plaintiff and against the defendant. 19. ISSUE NO.8: A defect in verification does not result in rejection of the suit. The Court can always give a chance to the parties to make amendment in the suit. In the present case, the plaintiff filed amended suit and in the amended suit, she corrected the verification. This amendment was allowed by the Court. Now this issue has become redundant. 20. RELIEF: In view of my findings in issue No.2, the plaintiff is not entitled to relief of specific performance. However, a perusal of agreement shows that the earnest money in this case was only Rs. Two Lac and not Rs.Three lac. The forfeiture clause is reproduced as under: 1. Now this issue has become redundant. 20. RELIEF: In view of my findings in issue No.2, the plaintiff is not entitled to relief of specific performance. However, a perusal of agreement shows that the earnest money in this case was only Rs. Two Lac and not Rs.Three lac. The forfeiture clause is reproduced as under: 1. That 31.01.2004 is the date fixed as the final, on or before this date, the second party will pay the balance consideration amount, and in lieu of the same, the first party will execute the regular documents of sale in favour of the second party, and if the first party will not fulfill his part of the contract, than the second party shall remain free either to accept the double of the earnest money amount from the first party, or entitle to complete this bargain through court of law on the cost and risk of first party, and if second party/purchaser will not fulfill his part of the contract, then the party/earnest money amount paid today to the first party will stand forfeited and the deal will come to an end. A perusal of this clause would show that the defendant could forfeit only Rs.2 lac which was the amount paid on the date of entering into the agreement and he had no right to forfeit Rs.3 lac as stated by him in his notice. He was bound to return the amount of Rs.1 lac to the plaintiff. Since he did not return this amount of Rs.1 lac to the plaintiff on 1st February 2004, defendant is bound to pay interest to the plaintiff on this amount from 1st February 2004 till realization, at a reasonable rate. In the facts and circumstances of the case, I think it appropriate that an interest @ 15% per annum would be a reasonable rate of interest as the defendant utilized this money all along. He is directed to refund Rs.1,00,000/-(Rupees One Lac) with 15% simple interest to plaintiff w.e.f. 1st February 2004 till the date of realization. 21. I, therefore, pass a decree that the defendant is liable to return an amount of Rs.1 lac to the plaintiff @ 15% per annum from 1st February 2004 till realization. Suit of the plaintiff is decreed in the above terms with proportionate costs. Decree sheet be drawn accordingly.