Research › Search › Judgment

Kerala High Court · body

2024 DIGILAW 759 (KER)

Balakrishna Menon (Died) S/o. Pynkil Madhavi Amma v. Gopala Menon (Died)

2024-06-28

EASWARAN S.

body2024
JUDGMENT : The defeated plaintiff in a suit for specific performance is the appellant before this Court. The pointed question that arises for consideration before this Court is whether after a lapse of near 40 years of the execution of the agreement of sale, this Court should grant a decree for specific performance in favour of the appellant/plaintiff. The success of the plaintiff in this appeal would depend only if multiple points are found in his favour. 2. The present appeal, AS No.919/1996, arises from the judgment and decree dated 31.10.1992 in OS No.193/1988 on the files of Additional Subordinate Court, Irinjalakuda. The above OS was disposed of along with OS No.364/1986, which was filed by respondents 3 to 6 herein, who are defendants 3 to 6 in OS No.193/1988. The appellant herein was the 1st defendant in OS No.364/1986. Even though, an appeal was preferred as AS No.905/1995, before this Court, the same was dismissed for default as per judgment dated 21.3.2013. Till today it is not restored to file. The impact of the dismissal of the AS No 905 of 1998 for default will be discussed later in this Judgment. 3. OS No.364/1986 was filed for an injunction against the plaintiff in OS No.193/1988 from trespassing into the plaint schedule property. After two years on filing of OS No 364/1986, the plaintiff in OS No.193/1988 claimed specific performance of Ext.A2 agreement executed between the plaintiff and Gopala Menon and Kochu Govinda Menon who are defendants 1 and 2, respectively. Plaintiffs in OS No.364/1986 are the assignees from defendants 1 and 2. Their assignments were in the year 1986. Apprehending that the plaintiff in OS No.193/1988 will trespass into the property and disturb their peaceful possession, OS No.364/1986 was filed. 4. The plaint averments in OS No.193/1988 shows that the plaintiff along with defendants 1 and 2 entered into a Karar with one Mr.Mambilly Thomas on 29.9.1984 as per which the said Mambilly Thomas had agreed to assign 66.7 cents of land in favour of plaintiff and defendants 1 & 2 for a sum of Rs.13,34,000/-. The plaint schedule property covers an extent of 35.7 cents in Sy No.262/1 of Lokamaleswaram Village forming part of larger extent of 66.7 cents in the same survey number which is the subject matter of the agreement dated 29.9.1984. The plaint schedule property covers an extent of 35.7 cents in Sy No.262/1 of Lokamaleswaram Village forming part of larger extent of 66.7 cents in the same survey number which is the subject matter of the agreement dated 29.9.1984. It is further averred in the plaint that the entire 66.7 cents of land in Sy.No.262/1 of Lokamaleswaram Village was in possession of the plaintiff since Mambilly Thomas had done the sale. 96 cents in Sy.No.559/6 of Pullut Village was also subject matter of the Karar on 29.9.1984. Out of the said 96 cents, 48 cents was purchased by the plaintiff in his own name and 48 cents purchased by the plaintiff in the names of defendants 1 & 2, since he had borrowed money from them earlier in June, 1983 for a sum of Rs.2,25,000/-. Therefore, for balance 35.7 cents mentioned in the plaint schedule, the plaintiff and Mambilly Thomas executed two deeds of exchange in respect of 31 cents in Sy.No.262/1 of Lokamaleswaram Village on 22.7.1985 and 6.9.1985 and these documents have been registered as document Nos.2454 and 2842 of 1985 of Kodungallur Village. As per the terms of the agreement, the plaintiff on 20.9.1985 had agreed to convey the said item which was nominally to purchase from Mambilly Thomas in pursuance to the karar dated 29.9.1984 and the plaintiff paid a sum of Rs.3,41,300/-to defendants 1 and 2. Rs.2,48,900/-was paid to the 2nd defendant and Rs.92,400/-was paid to the 1st defendant. On 13.12.1985, Mambilly Thomas and defendants 1 and 2 together executed an exchange deed assigning items mentioned in the schedule in favour of defendants 1 and 2 in consideration of them assigning 48 cents in Sy.No.559/6 of Pullut Village, which stood in their names. The entire amount due to Mambilly Thomas being the difference in the price of two items of properties to be exchanged as per karar dated 29.9.1984 was paid only by the plaintiff. The original karar dated 29.9.1984 was also in the custody of the plaintiff. Thereafter, the plaintiff offered to pay defendants 1 and 2 a sum of Rs.3,41,300/-to execute the deed of conveyance. Though the defendants 1 and 2 agreed to accept the aforesaid, they wanted more time. The original karar dated 29.9.1984 was also in the custody of the plaintiff. Thereafter, the plaintiff offered to pay defendants 1 and 2 a sum of Rs.3,41,300/-to execute the deed of conveyance. Though the defendants 1 and 2 agreed to accept the aforesaid, they wanted more time. However, later it is alleged that defendants 1 and 2 colluded with other defendants and fraudulently concocted some documents purporting to show that the defendants 1 & 2 have assigned the property to defendants 3 to 7 in five portions. According to the plaintiff, since he obtained possession of 66.7 cents pursuant to the karar dated 29.9.1984, and that he was entitled for specific performance, the suit was instituted. 5. The defendants 1 and 2 appeared and contested the suit filing the written statement. It was specifically denied that the plaintiff was put to possession of 66.7 cents of land in Sy.No.262/1 of Lokamaleswaram Village. The defendants 1 and 2 also contended that the 1st defendant and plaintiff were shareholders in a finance company, named ‘Pioneer Financiers’, Irinjalakkuda, and the plaintiff was the Chairman of the firm. The 2nd defendant’s nephew was a shareholder of the firm and that is how the 2nd defendant was introduced to the plaintiff. The plaintiff had only paid price of his own property and that sale price in respect of the property purchased by these defendants were paid by the defendants. During September, 1985, the plaintiff approached these defendants and told that Mambilly Thomas is expressing certain doubts with regard to the exchange of properties belonging to these defendants and the defendants came to know that the plaintiff had managed to effect the exchange between himself and Mambilly Thomas and these defendants were naturally put to in embarrassing position. According to the defendants, the plaintiff suggested that he will prevail upon Mr. Thomas to exchange the property as per the karar and that he will also prevail upon Mr. Thomas to re-assign the property upon these defendants. According to the defendants, since Mr.Mambilly Thomas is also a necessary party to the agreement, absence of him in the party array is detrimental to the cause of the plaintiff. On the prayer for specific performance, it was contended that it was strange to pray for a specific performance of a contract without mentioning the sale price. According to the defendants, since Mr.Mambilly Thomas is also a necessary party to the agreement, absence of him in the party array is detrimental to the cause of the plaintiff. On the prayer for specific performance, it was contended that it was strange to pray for a specific performance of a contract without mentioning the sale price. The plaintiff had cleverly avoided to mention anything concerning the sale price and therefore, according to the defendants, the plaintiff is not entitled to any relief based on the karar dated 20.9.1985. 6. Based on the averments in the plaint and in the written statement, the trial court framed the following issues: “(1) Whether the plaintiff is in actual physical possession of the plaint schedule property? (2) Whether the defendants have committed breach of contract? (3) Whether the plaintiff is entitled to get a decree for specific performance of contract? (4) Whether the plaintiff is entitled to get damages? (5) Reliefs and costs?” 7. On behalf of the plaintiff, Exts.A1 to A7 were produced and marked and PW1 to PW5 were examined. On behalf of defendants, Exts.B1 to B14 were produced and DW1 to DW3 were examined. 8. Based on the materials and evidence on record, the trial court came into conclusion that the plaintiff is not entitled for a specific performance of the agreement. The trial court proceeded to find that the plaintiffs in OS No.364/1986 are the bona fide purchasers of the property from defendants 1 and 2 in OS No.193/1988 and accordingly declined to grant specific performance. However, the alternate relief of damages quantified at Rs.4,00,000/-was directed to be paid the hence, the suit was decreed to that extent. It is aggrieved by the refusal on the part of trial court to grant specific performance of the agreement that the plaintiff has approached this Court by filing AS No.919/1996. As No.905/1995 is taken against the judgment and decree in OS No.364/1986, in which the appellant herein/plaintiff in OS No.193/1988 has been restrained by a permanent prohibitory injunction from trespassing into the properties held by the plaintiffs in OS No.364/1986/d efend ants 3 to 6 in OS No.193/1988. 9. I have heard Sri.G.Sreekumar Chelur, learned counsel appearing for the appellant, and Sri.Vinod Bhatt, learned counsel appearing for the 3rd defendant and Sri.M.P.Ramnath, the learned counsel appearing for the 7th defendant. 10. 9. I have heard Sri.G.Sreekumar Chelur, learned counsel appearing for the appellant, and Sri.Vinod Bhatt, learned counsel appearing for the 3rd defendant and Sri.M.P.Ramnath, the learned counsel appearing for the 7th defendant. 10. Sri.G.Sreekumar Chelur, learned counsel appearing for the appellant raised the following points: (1) The trial court failed to appreciate the true purport of Section 19(b) of the Specific Relief Act, 1963. (2) The provisions of Section 91 of the Indian Trusts Act, 1882 would also apply on the facts of the case entitling the plaintiff to claim specific performance of the agreement. (3) There was no essence of good faith in the transaction between defendants 1 to 2 and 3 to 7. (4) The defendants 3 to 7 had constructive notice of the karar which is the subject matter of the suit for specific performance because all the parties are residing in the vicinity of the property in question. (5) The attempt to alienate the property into 5 pieces of land would certainly show the intention of defendants 1 & 2 to defeat the performance of the karar. 11. The essence of the argument of Sri.G.Sreekumar Chelur, is that the specific performance of the agreement could be declined by the Court only if the ingredients of Section 19(b) are found against the plaintiff. The assertion on the part of the learned counsel for the appellant is basically against the lack of good faith in defendants 1 and 2 in alienating the property during the pendency of the agreement. 12. According to Sri.G.Sreekumar Chelur only if the transferee has shown that he has parted the money in good faith and without notice to the original contract that the relief for specific performance would be declined. Here, in this case, according to Sri.G.Sreekumar, the defendants 3 to 7 are residing near the residence of defendants 1 and 2 near the vicinity of the plaint schedule property and therefore presumed to have notice of the agreement and hence the trial court erred egregiously in holding that defendants 3 to 7 are bona fide purchasers of the property. He would also point out that once the trial court has found that there is breach on the part of defendants 1 and 2 in complying with the terms and conditions of the agreement, the necessary consequences should have followed which entitles the plaintiff to claim a decree for specific performance. 13. He would also point out that once the trial court has found that there is breach on the part of defendants 1 and 2 in complying with the terms and conditions of the agreement, the necessary consequences should have followed which entitles the plaintiff to claim a decree for specific performance. 13. On the other hand, Sri.Vinod Bhatt, learned counsel appearing for the 3rd defendant would submit that the claim of the appellant/plaintiff that he was put into possession of the property of an extent of 66.7 cents, has been found against by the trial court. There is no serious challenge to the said finding in the above appeal. Moreover, when the plaintiff himself has failed miserably to prove the assertion that he was put in possession of the property which is subject matter of the agreement for sale, and hence therefore he is not entitled for any discretionary relief. Further, it has been pointed out that even if the plaintiff was entitled for a decree for specific performance based on the failure on the part of defendants 3 to 7 in discharging their obligation under Section 19(b) of the Specific Relief Act, 1963 it does not absolve the plaintiff from discharging the burden under Section 16 of the Specific Relief Act, 1963. According to Sri.Vinod Bhatt, the learned counsel appearing for the 3rd defendant, the plaintiff will have to necessarily satisfy the court that he was ready and willing to perform his part of the contract and it should have been supported by evidence which is not the case here. 14. Sri.M.P.Ramnath, appearing on behalf of 7th defendant supported the contentions of Sri.Vinod Bhatt and further contended that his client has already transferred the property to the 3rd party and in the absence of any interdictory orders, such transfer cannot be interdicted by this Court. 15. In reply, the learned counsel Sri.G.Sreekumar Chelur would point out that during the pendency of the appeal, if the property has been sold, that will not affect the right of the plaintiff to claim specific performance of the contract. Any transfer pendente lite would be subject matter of the suit and the appeal and there cannot be any importance attached to the transfer made by the 7th defendant. 16. Any transfer pendente lite would be subject matter of the suit and the appeal and there cannot be any importance attached to the transfer made by the 7th defendant. 16. Based on the rival submissions raised before this Court, the question that this Court must consider is as to whether the finding of the trial court in declining to grant specific performance of the contract is to be interfered or not?. 17. The power of the court to grant specific performance is certainly discretionary. Even if the plaintiff succeeds in proving that breach occurred on the part of the defendants, the plaintiff cannot claim that the suit should be decreed as a matter of right. In other words, appellant cannot be heard to contend that the specific performance of an agreement should be granted as a necessary corollary of the finding that the breach has been occurred on the part of defendants 1 and 2. 18. Therefore, essentially, this Court would have to analyse the findings rendered by the trial court and has to see as to whether those findings are supported by evidence. Once the findings of the trial court are supported by evidence on record, necessarily the next question that would arise before this Court is as to whether this Court should exercise its appellate power and decree the suit in favour of the appellant. 19. It is to be noted that the suit for specific performance was instituted in the year 1988 and the judgment was rendered on 31.10.1992. The appeal has been pending on files of this Court from 1996. Nearly, after a lapse of 30 years, should this Court grant the decree of specific performance would also be a prime consideration which passes through the mind of this Court while rendering this judgment. 20. Before proceedings to consider the issue as to whether the plaintiff/appellant is entitled for specific performance or not, the pointed questions raised by the learned counsel for the appellant will have to be addressed first. 21. The primary question which has been raised by the learned counsel appearing for the appellant is that the defendants 3 to 7 have failed to discharge the duty cast upon them and they have failed to prove that they are purchasers of the property for a valuable consideration and without notice of the karar. 21. The primary question which has been raised by the learned counsel appearing for the appellant is that the defendants 3 to 7 have failed to discharge the duty cast upon them and they have failed to prove that they are purchasers of the property for a valuable consideration and without notice of the karar. Section 19(b), no doubt cast an obligation on the subsequent transferee to establish as to whether he/she is a purchaser of the property for a considered value and that too without notice of the karar. It is to be noted that the plaintiff/appellant did not adduce any evidence to show before the court that defendants 3 to 7 had any prior notice of the agreement between him and defendants 1 and 2. When this question was posted by this Court to the learned counsel for the appellant, the answer of the appellant was that it is presumed that the defendants 3 to 7 have constructive notice about the karar because they were residing in the vicinity of the subject matter of the plaint schedule property. However, this Court cannot assume that defendants 3 to 7 had a constructive notice in the absence of any material on record. 22. The question as to whether mere knowledge of agreement for sale was sufficient to discharge the burden of the plaintiff in a suit for specific performance came up for consideration in Kirtarath Rai v. Sripat Rai [ AIR 1928 All 307 ] and it was held that the mere fact that the transaction might have been known to a number of people is not enough. Still further, the Hon’ble Apex Court in Ram Niwas (dead) through Lrs. v. Bano (Smt) & Others [ (2000) 6 SCC 685 ] has laid down that “notice” under Section 19(b) of the Specific Relief Act may be (i) actual, (ii) constructive or (iii) imputed. Under Section 3 of the Transfer of Property Act and Explanation II thereof, a statutory presumption of “notice” arises against any person who acquires any immovable property or any share or interest therein of the title, if any, of the person who is for the time being in actual possession thereof. The further question would be whether the principle laid down by the Supreme Court in terms of Section 3 of the Transfer of Property Act would apply to the facts of the present case. The further question would be whether the principle laid down by the Supreme Court in terms of Section 3 of the Transfer of Property Act would apply to the facts of the present case. Admittedly, on evidence, it has been found though the plaintiff asserted that he has been put in possession, such claim has been thoroughly negatived for lack of evidence. Though the proposition canvassed by the appellant in terms of Section 3 of the Transfer of Property Act is indisputable, this Court is not persuaded to accept the contention of the learned counsel for the appellant, especially when the plaintiff’s assertion that he was in possession of the property has been specifically found against. In view of the aforesaid findings, this Court has to necessarily conclude that on the facts of this case, there was no notice of karar to defendants 3 to 7, much less a constructive notice could be inferred on facts. Hence, this Court has no other alternative, but to reject the aforesaid contention. This being so, the question of applicability of Section 91 of the Indian Trusts Act, 1882 pales into insignificance. 23. Once this Court has found that defendants 3 to 7 had no notice about the karar, which is subject matter of the suit, then necessarily the benefit of Section 19(b) will have to be granted to defendants 3 to 7. Therefore, this Court cannot find fault with the findings of the trial court that the defendants 3 to 7 are entitled for the benefit of Section 19(b) of the Specific relief Act, 1963 and thereby protecting their property from any decree that was liable to be granted in favour of the plaintiff. 24. In addition to the above, one of the most important factors which this Court could not afford to ignore is the conduct of the plaintiff which does not inspire confidence in the minds of this Court. It is admitted that the Karar which is the subject matter of the suit for specific performance was entered on 29.9.1984. The sale, which is subject matter of Exts.B3 to B9 are between 23.8.1986 and 4.9.1986. The suit for specific performance was filed only on 10.6.1988. Before filing of the suit for specific performance, the defendants 3 to 6 had already approached the court by filing a suit, OS No 364/1986, for injunction against the plaintiff in OS No.193/1988. The sale, which is subject matter of Exts.B3 to B9 are between 23.8.1986 and 4.9.1986. The suit for specific performance was filed only on 10.6.1988. Before filing of the suit for specific performance, the defendants 3 to 6 had already approached the court by filing a suit, OS No 364/1986, for injunction against the plaintiff in OS No.193/1988. Despite the service of summons in OS No.364/1986, the appellant/ plaintiff, chose to wait for two years after the receipt for filing the suit for specific performance. This in the considered view of this Court, would certainly deters this Court from exercising the discretion under the Specific Relief Act, 1963. 25. Not Doubt the suit filed by the plaintiff is within the period of limitation. The agreement in question do not prescribe any time limit for performance. Therefore when parties to the contract did not stipulate any period for performance of the contract, can it be said that the plaintiff need to file the suit only at the fag end of the expiry of the period of limitation. Answer to this question should be necessarily in negative against the plaintiff. Merely because the agreement does not stipulate the period for performance, that itself will not absolve the plaintiff from the burden of discharging that he had come before the court within sufficient time. It may be noticed that the agreement between the parties for sale of the property was on 20.9.1985 and the suit has been filed only on 10.6.1988. No doubt the suit, as found earlier is within the period of limitation. But the plaintiff had notice about the transfer of the plaint schedule properties in favour of defendants 3 to 7 when OS No.364/1986 was filed. Still, the plaintiff chose to wait till 1988 to prefer the present suit. It is in this context, that the court will have to consider exercise of the discretionary relief in granting the decree of specific performance. In the considered view of this Court, the factum of two years of delay which has not been explained in anywhere in the plaint, assume significance which would certainly disentitle the plaintiff to claim a decree for specific performance. 26. In the considered view of this Court, the factum of two years of delay which has not been explained in anywhere in the plaint, assume significance which would certainly disentitle the plaintiff to claim a decree for specific performance. 26. The question as to whether despite the suit being within the period of limitation, a plaintiff in a suit for specific performance could be non-suited on the ground that the delay in approaching the court is no longer res-integra. In K.S.Vidyanadam Vs Vairavan [ (1997) 3 SCC 1 ], it was held as follows. “It has been consistently held by the courts in India, following certain early English decisions, that in the case of agreement of sale relating to immovable property, time is not of the essence of the contract unless specifically provided to that effect. The period of limitation prescribed by the Limitation Act for filing a suit is three years. From these two circumstances, it does not follow that any and every suit for specific performance of the agreement (which does not provide specifically that time is of the essence of the contract) should be decreed provided it is filed within the period of limitation notwithstanding the time-limits stipulated in the agreement for doing one or the other thing by one or the other party. That would amount to saying that the time-limits prescribed by the parties in the agreement have no significance or value and that they mean nothing. Would it be reasonable to say that because time is not made the essence of the contract, the time-limit(s) specified in the agreement have no relevance and can be ignored with impunity? It would also mean denying the discretion vested in the court by both Sections 10 and 20.” 27. In Azhar Sultana v. B. Rajaani [ (2009) 17 SCC 27 ], it was held by the Supreme Court that the court keeping in mind the fact that it exercises a discretionary jurisdiction, would be entitled to take into consideration as to whether the suit had been filed within a reasonable time. What would be a reasonable time would, however, depend upon the facts and circumstances of each case. No hard-and-fast law can be laid down therefor. The conduct of the parties in this behalf would also assume significance. 28. In a more recent decision, Rajesh Kumar Vs Anand Kumar & Ors. What would be a reasonable time would, however, depend upon the facts and circumstances of each case. No hard-and-fast law can be laid down therefor. The conduct of the parties in this behalf would also assume significance. 28. In a more recent decision, Rajesh Kumar Vs Anand Kumar & Ors. [2024 SCC Online SC 981], the Apex Court had reiterated the point of law. On facts of the above case, it was found that conduct of the plaintiff in not filing the suit immediately on the transfer of property by the defendant and despite raising objection to the application for mutation by the purchasers was certainly a point put against the grant of decree for specific performance. 29. Certainly, the facts in Rajesh Kumar (supra) matches with the facts on hand. However, whatever said above, this Court cannot be oblivious of the fact that the question of delay was never in issue before the trial court. Therefore would it be proper for this Court to non suit the plaintiff on the ground of delay alone. The answer is obviously no. However, considering the fact that the appeal is pending for nearly 30 years this Court is of the definite view that on this issue the parties should not burden with a trial, on framing of additional issue. Therefore, the endeavour of this Court was only to find out whether the circumstances warrants exercise of discretion in favour of the plaintiff. There exists multiple factors which would dissuade this Court from exercising the discretion. The question of delay is only one of the factors. Pertinently, during the cross examination of the plaintiff a more specific question was raised regarding the delay in filing the suit, wherein he admitted that there was no reason to offer for delay in filing the suit. Still further, the discussion on this issue was necessitated since the plaintiff/appellant insists for a decree for specific performance despite having notice of the subsequent transfer as per Exts.B3 to B7 documents and the suit being filed only after 2 years from the said transfer. Further, there is no evidence on record to show that the plaintiff ever demanded specific performance before instituting the suit. This certainly shows lack of bonafide on the part of the plaintiff. Further, there is no evidence on record to show that the plaintiff ever demanded specific performance before instituting the suit. This certainly shows lack of bonafide on the part of the plaintiff. Therefore, the court cannot ignore the fact that the plaintiff could not discharge the burden under Section 16(c) of the Specific Relief Act, 1963. Therefore, when this Court is called upon to exercise the discretion vested in it under the provisions of the Specific Relief Act, 1963, certainly this Court is not persuaded to exercise the discretion in the light of these overwhelming facts. Added to the above, the plaintiff in not diligent in even prosecuting AS No.905/1995. The dismissal of the said appeal for default leading to the decree in OS No.364/1986 to become final would certainly bar the appellant in seeking specific performance of the agreement on the principles of res-judicata. Resultantly, if a decree for specific performance is granted by this Court in favour of the appellant, the same would be incongruous with decree in OS No.364/1986, which was allowed to become final. In view of the above findings, it becomes clear that the plaintiff is not entitled to get a decree for specific performance. Resultant discussion leads to the irresistible conclusion that the findings of the trial court in declining the grant of specific performance does not call for interference. The appeal lack merit and accordingly dismissed. Parties are directed to suffer irrespective costs.