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2011 DIGILAW 830 (KAR)

Akkamma v. Raymond Quadros

2011-08-16

K.GOVINDARAJULU, MOHAN M.SHANTANAGOUDAR

body2011
JUDGMENT MOHAN SHANTANAGOUDAR, J.—This appeal is filed by the original defendant against the judgment and decree passed in G.S. No. 4992/2002 by City Civil Court, Bangalore. The respondent herein was the plaintiff. Respondent herein filed suit for specific performance based on the agreement of sale Ex. P-1 dated 21.4.1999 relating to land bearing Survey No. 81/1C, measuring 20 guntas, situated at Bilekalli Village, Begur Hobli, Bangalore south Taluk. For the sake of convenience, the parties are referred to as per their respective ranks before the trial Court. 2. The case of the plaintiff is that the defendants being the owners of the land bearing Survey N0.81/1C, measuring 20 guntas, situated at Bilekalli Village, Begur Hobli, Bangalore south Taluk proposed to sell the suit schedule property to the plaintiff. After negotiation, the plaintiff agreed to purchase the said property for sale consideration of Rs. 10 lakhs. Thus, an agreement was entered into on 21.4.1999 as per Ex. P-1. On the date of the agreement, Rs. 50,000/- was paid as earnest money. A further sum of Rs. 50,000/- was paid on 19.6,1999 and another sum of Rs. 1 lakh was paid on 22.7.1999. Thus, in all, Rs. 2 lakhs were paid to the defendants as earnest money. From out of Rs. 2 lakhs paid by the plaintiff under Ex. P-1, an amount of Rs. 1,50,000/- was agreed to be paid to one Mr, Dayanand Pal for getting the land released. The agreement stipulates one year time for completion of the contract. The plaintiff avers that inspite of his repeated requests, the defendants did not come forward to execute the Sale Deed within the period of one year on the ground that the khata was not changed in the name of the defendants. After waiting for more than two years, the plaintiff issued a legal notice on 15.7.2002 to the defendants calling upon them to execute the Sale Deed. The defendants replied to the said notice on 26.7.2002 denying the request of the plaintiff for execution of the sale deed. Hence, the suit is filed for specific performance of the agreement of sale Ex. P-1 dated 21.4.1999. According to the plaintiff, time is not the essence of the contract. 3. The defendants admit that they are the absolute owners, and in possession of the suit schedule property. They admit that they have received Rs. Hence, the suit is filed for specific performance of the agreement of sale Ex. P-1 dated 21.4.1999. According to the plaintiff, time is not the essence of the contract. 3. The defendants admit that they are the absolute owners, and in possession of the suit schedule property. They admit that they have received Rs. 2 lakhs on different dates and the last amount of Rs. 1 lakh (out of Rs. 2 lakhs paid) was paid on 22.7.1999; the plaintiff has not come forward to perform his part of the contract and to take absolute sale deed from the defendants by paying the remaining balance of amount as per the terms and conditions of the agreement; since the plaintiff did not pay the balance of sale consideration of Rs. 8 lakhs within the stipulated period and as he did not come forward to take the absolute Sale Deed from the defendants, the defendants have forfeited the advance amount paid by him by rescinding the contract as there was breach of contract. According to the defendants, time is the essence of the contract, hence, they pray for dismissal of the suit on the ground that the plaintiff was neither ready nor willing to pay the balance of sale consideration of Rs. 8 lakhs to perform his part of the contract for obtaining the sale deed. 4. Based on the pleadings of the parties, the following issues were framed by the trial Court. Issues: (vernacular matter not given) Plaintiff examined himself as PW-1 and examined his friend as PW-2 who is the attesting witness to the Ex. P-1. He got marked 11 exhibits, On behalf of the defendants, defendant No. 2 is examined. Based on the material on record and after hearing, the trial Court decreed the suit, directing the defendants to execute the Sale Deed in respect of the schedule property in favour of plaintiff after receiving the balance sale consideration of Rs. 8 lakhs. The said judgment and decree passed by the trial Court is assailed in this appeal 5. Sri M.A. Humayun, learned counsel appearing on behalf of the appellants/defendants submits that the execution of the agreement of sale by the defendants is not disputed; as the documents were handed over by the defendants to the plaintiff on 20th of July 1999, on which day, the plaintiff had paid Rs. Sri M.A. Humayun, learned counsel appearing on behalf of the appellants/defendants submits that the execution of the agreement of sale by the defendants is not disputed; as the documents were handed over by the defendants to the plaintiff on 20th of July 1999, on which day, the plaintiff had paid Rs. 1 lakh to the defendants as per Clause-3 of the agreement; the suit is barred by limitation, inasmuch as, it is filed beyond three years from the date of agreement; there was no intention on the part of the parties to go ahead with the agreement in respect of execution of the sale deed, but the intention of the parties was to bind the parties to pay certain amount of damages as found in Clause-11 of the agreement; the trial Court is not justified in basing its conclusion only on the reason that the defendants did not get the khata changed in their name and consequently, the plaintiff was not in a position to get the sale deed executed; the plaintiff knew very well at the time of entering into agreement that khatha does not stand in the name of the defendants, but it stands in the name of the deceased propositus viz., Munirappa (husband of defendant No. l and father of defendant No. 2); despite the said fact, the plaintiff agreed to purchase the property without raising any objection with regard to change of khata; the agreement in question no where stipulates that the khata should be changed in the name of the defendants for enabling the plaintiff to pay the balance amount of Rs. 8 lakhs for getting the sale deed registered; the Court below is not justified in concentrating only on so called non-transferring of khata by the defendants; since the decree for specific performance is discretionary, the trial Court is not justified in directing the defendants to execute the sale deed in favour of the plaintiff, particularly in the fight of Clause-11 of the agreement; and the plaintiff was not ready and willing to perform his part of the contract at any point of time till filing of the suit. Based on these among other grounds, Sri Humayun, learned counsel prays for allowing the appeal and setting aside the judgment and decree passed by the Court below. 6. Based on these among other grounds, Sri Humayun, learned counsel prays for allowing the appeal and setting aside the judgment and decree passed by the Court below. 6. Sri V.S. Hegde, learned counsel appearing on behalf of the plaintiff-respondent submits that the dominant intention of the parties while executing the agreement to sell and thereafter, needs to be gathered from reading the entire agreement of sale Ex. P-1 and the material on record; the agreement itself makes it clear that the intention of the parties was to complete the transaction by executing the sale deed; the trial Court is justified in upholding the statutory right of the plaintiff to get the decree for specific performance; the suit is not barred by time; the very fact that the plaintiff has paid Rs. 1.5 lakhs, which in turn, was to be paid to Mr. Dayanand Pal (earlier prospective vendee) for getting the property released from the clutches of Dayanand Pal itself would go to show that the defendants are liable to execute the sale deed in favour of the plaintiff; the indemnity clause found in the agreement further fortifies the case of the plaintiff that the parties intended to get the transactions completed by getting the sale deed executed in the name of the plaintiff in respect of the suit schedule property. He further submits that under the facts and circumstances of the case, time is not the essence of the contract and, therefore, the trial Court is justified in decreeing the suit. 7. Based on the rival contentions of the advocates on record, the following points arise for consideration ; (a) Whether the trial Court is justified in holding that the suit is filed within the period of limitation? (b) Whether the Court below is justified in granting the discretionary relief relating to specific performance in favour of the plaintiff under the facts and circumstances of this case? 8. Regarding point No. 1: It is contended by the appellants Counsel that the suit is barred by limitation. The said submission cannot be accepted. The agreement of sale Ex. P1 entered into between the parties as per Ex. P1 is dated 21.4.1999. The said agreement stipulates that the sale deed shall be executed within one year from the date of the agreement of sale. Article 54 of the Limitation Act specifies as to when the time begins to run. The agreement of sale Ex. P1 entered into between the parties as per Ex. P1 is dated 21.4.1999. The said agreement stipulates that the sale deed shall be executed within one year from the date of the agreement of sale. Article 54 of the Limitation Act specifies as to when the time begins to run. The said Article clearly reveals the starting point of time for a suit for specific performance is the date fixed for performance or when the plaintiff has notice of refusal of performance by the defendant. Thus, it is clear that Article 54 of the Limitation Act specifies two points of time from which the limitation of three years begins for filing the suit for specific performance of the contract. One, is the date fixed for performance of contract and the second is, if there is no date fixed, when the plaintiff has notice of refusal by defendant. In the matter on hand, the date is fixed for performance of contract. As aforementioned, the agreement is dated 21.4.1999, the same stipulates one year time for completion of the contract. Thus, starting point of time would be 21.4.2000. Three years limitation is prescribed under the Article 54. Thus, the period of limitation would be up to 21.4.2003. The suit in the present case is filed on 31.7.2002. Hence, it is clear that the suit is filed within the period of limitation. 9. Regarding point No. 2: Though agreement Ex. P1 stipulates one year time for performance of the contract, the plaintiff kept quiet till 15.7.2002 on which date he issued notice as per Ex. P,8 calling upon the defendants to execute the sale deed. To decide the question whether the defendants were ever ready and willing to perform their part of the contract, it is relevant to note certain dates. Agreement of sale-Ex. P1 entered between the parties is dated 21.4.1999. The period fixed for executing the sale deed is one year from that date. A sum of Rs. 50,000/- was paid as earnest money on the date of the agreement, that is on 21.4.1999. A further sum of Rs. 50,000/- was paid on 19.6.1999, another sum of Rs. 1,00,000/- was paid by the plaintiff on 22.7.1999. Thus, in all Rs. 2,00,000/- were paid to the defendants by the plaintiff till 22.7,1999. Out of Rs. 2,00,000/-, a sum of Rs. 1,50,000/- was paid to one Mr. A further sum of Rs. 50,000/- was paid on 19.6.1999, another sum of Rs. 1,00,000/- was paid by the plaintiff on 22.7.1999. Thus, in all Rs. 2,00,000/- were paid to the defendants by the plaintiff till 22.7,1999. Out of Rs. 2,00,000/-, a sum of Rs. 1,50,000/- was paid to one Mr. Dayanand Pal by the defendants for getting the land released from him. The defendants had agreed to sell the land in favour of Mr. Dayanand Pal, prior to the execution of the agreement in question. Thus, in order to get the said property released from him the defendants paid Rs. 1,50,000/- from out of Rs. 2,00,000/- received by them from the plaintiff to Mr. Dayanand Pal. There is nothing on record to show as to what steps the defendants had taken after 22.7.1999 for getting the sale deed executed. Till the notice is issued by him on 15.7.2002, they have not come forward to get the sale deed executed in his favour. If the plaintiff was really ready and willing to perform his part of the contract at least up to the period of one year, he could have definitely issued notice calling upon the defendants to execute the sale deed, Though the agreement stipulates one year time from 21.4.1999, though the parties agreed to complete the sale transaction 21.4.2000, the plaintiff did not come forward to pay the balance of sale consideration to the defendants. He has not even issued notice to the defendants calling upon the defendants to execute the sale deed. There is nothing on record to show as to what was the reason for the plaintiff in not getting the sale deed executed and registered in his favour, 10. The only reason assigned by the plaintiff in the suit is that he approached the defendants and the defendants told him to wait till the katha is changed in their favour. Such an explanation by the plaintiff cannot be accepted inasmuch as, there is no clause as such in the agreement of sale mandating the defendants to get the katha changed in their name. Admittedly, the katha was standing in the name of husband of defendant No. 1 and father of defendant No. 2 namely Munierappa (propositus). Even as on the date of agreement of sale, the katha was standing in the name of Munierappa. Admittedly, the katha was standing in the name of husband of defendant No. 1 and father of defendant No. 2 namely Munierappa (propositus). Even as on the date of agreement of sale, the katha was standing in the name of Munierappa. None of the conditions contained in the agreement of sale stipulate that the defendants should get the katha changed in their name. Admittedly, Munierappa had expired even prior to the agreement of sale. Thus, there was no hurdle on the part of the defendants to execute the sale deed in favour of the plaintiff, inasmuch as they were the only legal representatives of Munierappa. It is not the case of the plaintiff that there are other legal representatives and that he should get the clear picture about the title of the prospective vendors. The very fact that the plaintiff had entered into an agreement of sale with defendants knowing fully well that katha was standing in the name of Munierappa even at the time of agreement of sale, itself would go to show that he did not feel it necessary to get the katha changed in the name of the defendants at the time of sale. If the plaintiff really wanted the change of khata and if really the defendants had refused to get the katha changed in their names, the plaintiff could have issued a legal notice calling upon the defendants to get the katha changed in their name. A bare reading of the agreement of sale would reveal that the vendors in the agreement of sale, that is defendants in the suit are the absolute owners of the property mentioned in the schedule. It is also mentioned in the agreement of sale, the property was earlier the subject matter of acquisition by the Government for the purposes of allotment to the Vyalikaval Housing Co-operative Society Limited. However, the said acquisition was quashed by the Hon’ble Supreme Court of India and consequently, the land has been re-delivered to the defendants and the defendants have paid back the compensation received by them to the State Government. These Facts amply go to show that the defendants are the owners of the property in question. This fact was known to the plaintiff also. If it is so, there was no occasion or there was no question of the plaintiff insisting the defendants to get the katha changed. These Facts amply go to show that the defendants are the owners of the property in question. This fact was known to the plaintiff also. If it is so, there was no occasion or there was no question of the plaintiff insisting the defendants to get the katha changed. These facts would clearly go to show that the explanation offered by the plaintiff in the suit that the katha was not changed by the defendants in their favour, appears to have been made only to over come the delay on his part. 11. As aforementioned, the plaintiff issued notice as per Ex. P8 to the defendants on 15.7.2002 calling upon the defendants to execute the sale deed. Thus, it is clear that the notice itself is issued after about 3 years from the date of agreement of sale. Absolutely, no valid or convincing reasons are assigned by the plaintiff to show that there was readiness and willingness on his part. The said notice issued by the plaintiff was received by the defendants on 24.7.2002. Reply to the said notice on 26.7.2002. Immediately, thereafter he has filed the suit on 31.7.2002. All these facts go to show that the plaintiff has prepared himself to get the sale deed only after issuing of notice - Ex. P8. Till that date, the plaintiff was not ready and willing to perform his part of the contract. 12. Shri Humayun, learned Advocate appearing on behalf of the appellant strongly relies on Clause 11 of the agreement of sale and submits that the parties never intended to complete the transaction of sale of the suit schedule property inasmuch as the intention of the parties was only to get the damages. The said submission cannot be accepted. It is relevant to note Clause 11 found in the agreement which reads thus: “That in the event of failure of the vendor to register the property in the names of the purchaser or his nominee, the vendor shall pay to the purchaser a sum of Rs. 1 lac as damages, In case the purchaser does not comply with the terms of this agreement, he shall forfeit the advance sum of Rs. 50,000/- and the balance shall be returned to him by the vendor, if any, paid to them”. 1 lac as damages, In case the purchaser does not comply with the terms of this agreement, he shall forfeit the advance sum of Rs. 50,000/- and the balance shall be returned to him by the vendor, if any, paid to them”. From the above, it is clear that the parties have agreed that in the event of failure of the vendor to register the property in the name of his purchaser or his nominee he will pay a sum of Rs. 1 lac as damages, to the purchaser. In case, the purchaser does, not comply with the terms of the agreement, the vendor will forfeit the advance amount of Rs. 50,000/- and the balance shall be returned by the vendor to the prospective purchaser. The said clause will not come to the aid of the defendants for contending that the intention of the parties was not to go ahead with the completion of the sale deed. The real intention of the parties will have to be gathered from the reading the agreement of sale as a shale. If the agreement of sale is read in its entirety, the same would make the intention of the parties will have to be gathered from the reading the agreement of sale as a whole. If the agreement of sale is read in its entirety, the same would make the intention of the parties clear that they wanted to get the execution of the sake deed completed. The very fact that the plaintiff had given 15 lakh after the agreement of sale for payment of the same to Mr. Dayanand Pal would go to show that the plaintiff as well as the defendants wanted the sale agreement to be completed. The parties have also agreed under the agreement of sale that they are at liberty to extend the period of agreement by mutual consent. Even the vendors have undertaken to indemnify the purchaser for all the losses whatsoever arising from any other claims. These facts would amply to show that the parties intended to get the agreement completed by executing the sale deed in favour of the plaintiff. 13. But as aforementioned the plaintiff himself was not ready and willing to perform his part of the contract, till he issued notice as per Ex. These facts would amply to show that the parties intended to get the agreement completed by executing the sale deed in favour of the plaintiff. 13. But as aforementioned the plaintiff himself was not ready and willing to perform his part of the contract, till he issued notice as per Ex. P8 to the defendants calling upon the defendants to execute the sale deed, Admittedly, such a notice was issued after a period of three years from the date of agreement of sale. Though the time was not the essence of the contract under the facts and circumstances of this case, the plaintiff is bound to show his readiness and willingness to perform his part of the contract. Since there is nothing on record to show that the plaintiff was ready and willing to perform his part of the contract, he is not entitled to decree for specific performance. 14. It is needless to observe that in order to succeed in a suit for specific performance of the contract and to enable the plaintiff to the relief of specific performance, the plaintiff must not only aver in the plaint that he is ever ready and willing to perform his part of the contract but also should prove that he was ever ready and willing to perform his part of the contract from the date of the agreement till the date of hearing of the suit. Even when the time is not the essence of the contract, the plaintiff has to show to the Court that he was ready and willing to perform his part of the contract. These aspects of the matter are not appreciated by the Court below in proper perspective. The trial Court mainly proceeded by accepting the case of plaintiff that the defendants did not get the katha changed in their name. The appreciation of the evidence by the Court below and the conclusions arrived at are not proper and correct. In view of the above, the Judgment and decree passed by the trial Court is liable to be set aside. It is not in dispute that the defendants have received Rs. 2,00,000/- from the plaintiff in the year 1999(last payment was on 21.7.1999). Thus, they are entitled to refund of the said monies with interest thereon. In view of the above, the Judgment and decree passed by the trial Court is liable to be set aside. It is not in dispute that the defendants have received Rs. 2,00,000/- from the plaintiff in the year 1999(last payment was on 21.7.1999). Thus, they are entitled to refund of the said monies with interest thereon. Accordingly, the following order is passed; (a) The Judgment and decree passed by the Court below stands set aside; (b) The suit filed by the respondent herein for specific performance stands dismissed; (c) The defendants shall refund Rs. 2,00,000/- with interest @ 10% per annum from July 1999 till date of payment to the plaintiff. 15. The appeal is allowed in part accordingly.