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2015 DIGILAW 730 (KAR)

MARIYAMMA v. DISTINAPPA

2015-07-09

B.S.PATIL

body2015
ORDER 1. Defendants in O.S.No.591/1989 have filed this revision petition challenging the rejection of their application filed under Section 28(1), (2) and 4 of the Specific Relief Act, 1963 (for short ‘the Act’) for rescission of the contract. 2. Facts, stated in brief, are that on 26.11.1985, an agreement of sale was executed between the plaintiff and one Mrs. Mariamma – 1st defendant. Defendant No.1 agreed to execute the registered sale deed to an extent of 2 acres 15 guntas of land situated at Moodala Dasapura Village in Channarayapatna Taluk, Hassaan District. Sale consideration agreed was Rs.25,000/-. Out of which, Rs.15,000/- was paid as advance and the remaining amount of Rs.10,000/- was to be paid at the time of execution of the registered sale deed. As the 1st defendant did not execute the sale deed, plaintiff filed the suit on 13.01.1989. It transpires that after the agreement and 1st before the suit could be filed, the defendant executed a registered gift deed in respect of the very property in favour of her daughter – defendant No.2 on 16.04.1986. 3. The Trial Court decreed the suit on 03.02.2000. Defendants were directed to execute the sale deed within three months by receiving Rs.10,000/-. Aggrieved by this judgment and decree, defendants filed R.A.No.21/2000. The appeal came to be renumbered as R.A.No.173/2002. It was dismissed on 27.11.2006. Aggrieved by the same, a Regular Second Appeal was filed by the defendants in R.S.A.No.473/2007. The second appeal was dismissed as withdrawn on 29.06.2007. 4. On 08.03.2007 during the pendency of the second appeal, an application was filed by the defendants, in the suit, under Section 28 of the Act seeking rescission of the contract. On 30.03.2007, plaintiff filed an application before the Trial Court seeking extension of time to deposit the amount. It is also relevant to notice that even in the Regular Appeal, plaintiff had filed an application seeking extension of time and the Appellate Court without notice to the defendants had allowed the application granting extension of time vide order dated 17.03.2008. This order was challenged in miscellaneous proceeding by the defendants contending inter alia that the application had been allowed without notice to them and without hearing them. In this background and for several other reasons, miscellaneous petition filed by defendants was allowed and the order granting extension of time to the plaintiff to deposit the balance amount of Rs.10,000/- was recalled. In this background and for several other reasons, miscellaneous petition filed by defendants was allowed and the order granting extension of time to the plaintiff to deposit the balance amount of Rs.10,000/- was recalled. Thereafter, the Trial Court has heard both parties on the applications filed by them and has passed the impugned order rejecting the application filed by the defendants seeking rescission of the contract. It is in this background, present revision petition has been filed challenging the order dated 25.06.2014 passed by the Trial Court. 5. Learned counsel appearing for the revision petitioners strongly contends that the order under challenge suffers from illegality and material irregularity inasmuch as without considering the lack of bonafides on the part of the plaintiff in committing default and in delaying to deposit the balance sale consideration and without taking note of the resultant loss and injury that had occasioned to the defendants, the Court below has passed the impugned order refusing to rescind the contract. It is his submission that while dismissing the regular appeal though the Appellate Court had not fixed any time limit for depositing of the amount and for execution of the sale deed, the fact that it confirmed the decree passed by the Trial Court disclosed that the time limit of three months fixed by the Trial Court for executing the registered sale deed and payment of balance sale consideration of Rs.10,000/- operated against both parties and regulated them, therefore, the plaintiff ought to have deposited the amount of Rs.10,000/- within three months from the date of judgment in the regular appeal on or 1st before 27.02.2007. He urges that it is the defendant who moved the application on 08.03.2007 under Section 28 of the Act bringing to the notice of the Trial Court that plaintiff had committed default in depositing the balance sale consideration and therefore, the contract may be rescinded; it was only after such an application was made by the defendant, plaintiff chose to make an application on 30.03.2007 seeking extension of time to deposit the amount. It is, therefore, urged by him that having regard to the decree passed and the time frame required to be followed by the parties, the Court below was not right and justified in rejecting the application filed by the defendants. In support of his assertions, he has placed reliance on the following judgments: (i) T.L. RAJAGOPAL VS. It is, therefore, urged by him that having regard to the decree passed and the time frame required to be followed by the parties, the Court below was not right and justified in rejecting the application filed by the defendants. In support of his assertions, he has placed reliance on the following judgments: (i) T.L. RAJAGOPAL VS. S.N. SHIVAKUMAR (2014) 6 KAR. L.J. 423 (ii) RAMESHWAR AND OTHERS VS. JOT RAM AND OTHERS AIR 1976 SC 49 (iii) ONKAR NATH AND ANOTHER VS. BASHER AND OTHERS AIR 1986 PUNJAB AND HARYANA 152 and (iv) VEERAPPA (DEAD) BY L.R AND ANOTHER VS. BASAVANYAPPA (DEAD) BY L.RS. (2014) 6 KAR. L.J. 432. 6. Strongly refuting these contentions learned counsel for the respondent has contended that during the pendency of the appeal filed by the defendants in R.A.No.21/2000 (New No.173/2002), there was an interim order of stay of the decree which was in force till the dismissal of the appeal on 27.11.2006. The judgment and decree passed in regular appeal was challenged before this Court in R.S.A.No.473/2007. He urges that the plaintiff had entered caveat when the Regular Second Appeal was pending till 29.06.2007. He, therefore, points out that non-deposit of the amount, during the pendency of the regular appeal or for that matter, when the regular second appeal was pending before this Court, has to be regarded as bonafide cause or reason. He points out that even before the regular second appeal was dismissed, defendants had filed an application on 08.03.2007 seeking rescission of the contract and so far as the plaintiff was concerned, well before the disposal of the regular second appeal, he had taken steps to present the application on 30.03.2007 seeking extension of time to deposit the amount. He, therefore, urges that this is not a case where the plaintiff is guilty of unreasonable delay in depositing the balance amount entailing consequence spelt out in Section 28(1) of the Act for rescission of the agreement of sale. In support of his contention he has placed reliance on the following judgments : (i) ASHOK CATERERS VS. MUNICIPAL CORPORATION OF GREATER BOMBAY (1997) 9 SCC 220 (ii) NAGARATHINAM VS. VELAMMAL (2000) 1 MADRAS L.J. 712 7. In support of his contention he has placed reliance on the following judgments : (i) ASHOK CATERERS VS. MUNICIPAL CORPORATION OF GREATER BOMBAY (1997) 9 SCC 220 (ii) NAGARATHINAM VS. VELAMMAL (2000) 1 MADRAS L.J. 712 7. Learned counsel for the respondent has also urged that there is no error of jurisdiction or illegality committed by the Court below resulting in miscarriage of justice warranting interference of this Court in exercise of revisional jurisdiction under Section 115 CPC. In support of this contention, he has placed reliance on the judgment of the High Court of Andhra Pradesh in the case of YELLA SIMHACHALAM Vs. SIRIPURAM SOMULU – (2001) 5 ALT 235 . 8. Having heard the learned counsel for both sides, the only point that arises for consideration is Whether the Court below has acted illegally or with material irregularity in exercise of its jurisdiction while rejecting the application filed by the defendants seeking rescission of the Agreement of Sale? 9. Section 28 of the Specific Relief Act provides that where in any suit, a decree for specific performance of a contract for the sale or lease of immovable property has been made and the purchaser or lessee does not, within the period allowed by the decree or such other period extended by the Court to pay the purchase money as ordered, vendor may apply to have the contract rescinded and on such application being filed, the Court may rescind the contract. It is thus clear that the Court which passed the decree has the power to rescind the contract and has also got the discretion to extend the time for payment of money as ordered in the decree. The question to be considered, in this case is whether the Court below has exercised its discretion in accordance with sound judicial principles or has it acted illegally or with material irregularity in exercising such power/discretion. 10. The revision petitioners having suffered the decree on 03.02.2000 had preferred Regular Appeal in R.A.No.21/2000. The appeal was pending till 27.11.2006. There was an interim order of stay of operation of the judgment and decree. Therefore, non-deposit of the balance amount of Rs.10,000/- during this period cannot be termed as conduct that could be described as one lacking bonafides. Similarly, even after the disposal of the Regular Appeal, the matter did not attain finality. Defendants preferred Regular Second Appeal in R.S.A.No.473/2007. There was an interim order of stay of operation of the judgment and decree. Therefore, non-deposit of the balance amount of Rs.10,000/- during this period cannot be termed as conduct that could be described as one lacking bonafides. Similarly, even after the disposal of the Regular Appeal, the matter did not attain finality. Defendants preferred Regular Second Appeal in R.S.A.No.473/2007. Plaintiff had entered caveat. He was aware of filing of RSA. The RSA was pending admission till 29.06.2007. If the plaintiff had not deposited the amount in the interregnum, it could be only because of the apprehension that the judgment and decree passed by the Court below had been challenged by the defendants in the High Court and therefore, he was bonafide awaiting the result of the RSA. The said proceedings eventually got terminated on 29.06.2007. Therefore, lapse on the part of the plaintiff in depositing the balance amount of Rs.10,000/- during the pendency of the Second Appeal also cannot be characterized as one that disentitles the plaintiff to seek extension of time. In other words, as the defendants themselves had challenged the decree passed by the Trial Court and had obtained interim order of stay before the lower Appellate Court and later, on the dismissal of the appeal were prosecuting the RSA before the High Court, they cannot be permitted to say that the plaintiff had no right in law to seek for extension and defendants had secured a vested right to seek rescission of the contract which the court below ought to have ordered. 11. In a matter like this, the Court which is called upon to decide the issue regarding rescission of the contract has to exercise its discretion and the discretion has to be exercised on sound judicial principles. Keeping in mind the pendency of the proceedings and the fact that substantial amount of Rs.15,000/- had been already paid and what was required to be paid/deposited was an amount of Rs.10,000/-, the discretion exercised by the Court below in refusing to rescind the contract by rejecting the application filed by the defendants cannot be termed as illegal. 12. The judgments on which learned counsel for the petitioners has placed reliance are rendered under different fact situations. In the case of T.L. RAJAGOPAL Vs. 12. The judgments on which learned counsel for the petitioners has placed reliance are rendered under different fact situations. In the case of T.L. RAJAGOPAL Vs. S.N. SHIVAKUMAR 2014 (6) Kar.L.J. 423 , this Court, on the facts of the said case has held that the plaintiff therein had failed to deposit sale consideration of Rs.2,85,000/- within the time stipulated in the decree or at least on the date he filed the execution petition. He had made up his mind to deposit the money nearly 8 years after passing of the decree and 14 years from the date of agreement. There was no material to show that in the interregnum, the decree had been stayed and there were any bonafide reasons for the plaintiff therein to seek extension of time. The situation in this case, as already adverted to above is totally different. Hence, this judgment has no application to the facts of the present case. 13. Similarly, judgment in the case of VEERAPPA (DEAD) BY L.R. AND ANOTHER Vs. BASAVANYAPPA (DEAD) BY L.Rs. 2014(6) Kar.L.J. 432 has no bearing on the facts of the present case because the plaintiff in the said case had filed execution petition wherein the defendant had sought for rescission of the contract. Decree of specific performance granted by the Trial Court on 25.09.1978 had been confirmed in appeal by dismissing the Regular Appeal on 30.03.1982 and the execution proceedings had been initiated in the year 2010. In that background, having regard to the enormous delay which remained unexplained by the plaintiff in the said case, this Court was of the view that rescission of the contract as ordered by the Court below was right and justified. 14. Similarly, the facts involved in the judgment rendered by the Punjab and Haryana High Court in the case of ONKAR NATH & ANOTHER Vs. BASHEER AND OTHERS – AIR 1986 PUNJAB & HARYANA 152 has no application to the facts of the present case. Insofar as the judgment of the Apex Court in the case of RAMESHWAR AND OTHERS Vs. Similarly, the facts involved in the judgment rendered by the Punjab and Haryana High Court in the case of ONKAR NATH & ANOTHER Vs. BASHEER AND OTHERS – AIR 1986 PUNJAB & HARYANA 152 has no application to the facts of the present case. Insofar as the judgment of the Apex Court in the case of RAMESHWAR AND OTHERS Vs. JOT RAM AND OTHERS – AIR 1976 SC 49 , the ratio laid down therein is with regard to the general principle that the right to relief must be judged to exist as on the date a suit or other legal proceeding is instituted and later developments cannot defeat his rights inasmuch as rights vested by statute cannot be divested. This principle has no application to the facts of the present case. There is no such vested right to seek rescission of the contract. No doubt the revision petitioners – defendants have a right to apply seeking rescission of contract, but that right is subject to the discretion to be exercised by the Court having regard to the facts and circumstances of each case. 15. In the instant case, the Court below has taken note of all relevant factors, particularly the pendency of appeal, existence of interim order of stay and the subsequent proceedings initiated in the RSA while coming to the conclusion that the claim made by the defendants for rescission of the contract could not be acceded to. It is true, the Court below has made factual mistake in holding that Gift Deed was executed by defendant No.1 in favour of defendant No.2 after the suit was filed, as indeed, the Gift Deed was not executed after the suit was filed, but was executed prior to the filing of the suit, but after the Agreement of Sale was executed. This by itself does not, in any manner, vitiate the conclusion reached by the Court below. 16. The Court below has taken note of the totality of the circumstances while exercising its discretion and in rejecting the prayer for rescission of the contract made by the defendants. Indeed, if the application were to be allowed and the Agreement of Sale were to be rescinded, it would cause irreparable loss and injury to the plaintiff who has litigated the matter over several decades. Indeed, if the application were to be allowed and the Agreement of Sale were to be rescinded, it would cause irreparable loss and injury to the plaintiff who has litigated the matter over several decades. As rightly held by the court below there was no lack of bonafides on the part of the plaintiff in delaying the deposit of balance sale consideration. There is no illegality, nor there is failure of justice. 17. Hence, the revision petition being devoid of merits is dismissed.