Post on 23-Jul-2020
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IN THE HIGH COURT OF KARNATAKA AT BANGALORE
Dated this the 11th day of October, 2013
PRESENT
THE HON’BLE MR.JUSTICE N. KUMAR
AND
THE HON’BLE MR.JUSTICE V.SURI APPA RAO
RFA NO.1242/2003 &
Misc. Civil No. 13365/2010 C/W
RFA NO.1312/2003 IN RFA NO.1242/2003 &
Misc. Civil No. 13365/2010
BETWEEN: Smt Padmini Raghavan W/o Dr.Ravi Raghavan Aged 45 years Now residing at Villa No.15, Prestige Cedars No.7, Convent Road Bangalore – 560025 …APPELLANT
(By Sri Udaya Holla, Senior Counsel for Sri Dayanand
S. Naik, Advocate)
2
AND: 1. Mr.H A.Sonnappa,
S/o Appaiahnnaa @ Byrappa, Aged about 40 years, Residing at Hennur Bande, St.Thomas Town Post Bangalore – 560084 Since dead by his LRs
1(a) Smt.Bhagyamma
W/o H.A.Sonappa Aged about 50 years
1(b) Sri Shivkumar
S/o H.A.Sonappa Aged about 31 years
1(c) Sri S.Mohan Kumar
S/o H.A.Sonappa Aged about 29 years
1(d) Sri Sunil Kumar
S/o H.A.Sonappa Aged about 27 years
1(e) Sri S.Srikant Kumar
S/o H.A.Sonappa Aged about 25 years
1(f) Sri Anil Kumar
S/o H.A.Sonappa Aged about 23 years
1(g) Sri S.Arun Kumar
S/o H.A.Sonappa Aged about 21 years
3
1(h) Smt.Bindu D/o H.A.Sonappa Aged about 19 years
All are residing at: Annayyappa Colony Opposite RTC, St.Thomas Town Post Hennur Bande Bangalore – 560084
2. Smt.Hanumakka
W/o Late Muniswamy Gowda Aged about 70 years Residing at Thimmasandra Village Sulubele Hobli, Hosakote Taluk Bangalore Rural District
Since dead by LR:
2(a) Mr.Ashwathappa S/o late Muniswamy Gowda No.21, 1st Main Road, 6th Cross Pampa Extension Kempapura, Bangalore – 560 024
3. Smt.Lakshmi Thamaiah
W/o Thamaiah, Major in age Residing at Vaidyanathapura Maddur Taluk, Mandya District
4. Sri V.T.Anand
S/o V.B.Thanaiah, Major in age Residing at Vaidyanathapura Maddur Taluk, Mandya District …RESPONDENTS
(By Sri S Vijayashankar, Senior Counsel for Sri T.Seshagiri
Rao, Advocate, for R1(a) to (h);
4
Sri B.V.Acharya, Senior Counsel, for Sri Chouta, Advocate, for R3 & R4)
This RFA is filed u/S 96 read with Order XLI Rule 1 of
the Code of Civil Procedure, against the Judgment and Decree dated 10.07.2003 passed in O.S.No.316/93 on the file of the II Addl. Civil Judge (Senior Division), Bangalore Rural District, Bangalore, decreeing the suit for specific performance of agreement.
Misc. Civil No. 13365/2010 is filed praying to permit the appellant to produce additional documents for the reasons stated therein.
IN RFA NO.1312/2003
BETWEEN: 1. Smt.Lakshmi Thamaiah
W/o Sri Thamaiah, Major in age Residing at Vaidyanathapura Maddur Taluk, Mandya District
2. Sri V.T.Anand,
S/o V.B.Thanaiah, Major in age Residing at Vaidyanathapura Maddur Taluk, Mandya District …APPELLANTS
(BY Sri B.V.Acharya, Senior Counsel, for Sri Chouta,
Advocate) AND: 1. Sri H.A.Sonnappa
S/o Sri Appaiahnna Aged about 43 years Residing at Hennur Bande St.Thomas Town Post Bangalore – 560084
5
Since dead by his LRs 1(a) Smt.Bhagyamma
W/o H.A.Sonappa Aged about 50 years
1(b) Sri Shivkumar
S/o H.A.Sonappa Aged about 35 years
1(c) Sri S.Mohan Kumar
S/o H.A.Sonappa Aged about 33 years
1(d) Sri Sunil Kumar
S/o H.A.Sonappa Aged about 31 years
1(e) Sri S.Srikant Kumar
S/o H.A.Sonappa Aged about 29 years 1(f) Sri Anil Kumar
S/o H.A.Sonappa Aged about 27 years
1(g) Sri S.Arun Kumar
S/o H.A.Sonappa Aged about 25 years
1(h) Smt.Bindu
D/o H.A.Sonappa Aged about 25 years
All are residing at: Annayyappa Colony Opposite RTC Hennur Bande
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Bangalore – 560084 2. Smt.Hanumakka
W/o Late Muniswamy Gowda Aged about 70 years Residing at Thimmasandra Village Sulubele Hobli, Hosakote Taluk Bangalore Rural District
Since dead by LR:
2(a) Mr.Ashwathappa S/o late Muniswamy Gowda No.21, 1st Main Road, 6th Cross Pampa Extension Kempapura, Bangalore – 560024
3. Smt Padmini Raghavan
W/o Dr.Ravi Raghavan Aged 45 years Now residing at Villa No. 15, Prestige Cedars, No.7, Convent Road, Bangalore – 560 025 …RESPONDENTS
(By Sri S Vijayashankar, Senior Counsel for Sri T.Seshagiri
Rao and Sri Sunil S Rao, Advocate, for R1(a) to (h); Sri Udaya Holla, Senior Counsel for Sri Dayanand S Naik,
Advocate, for R3; R2 dead ) This RFA is filed u/S 96 read with Order XLI Rule 1 of
the Code of Civil Procedure, against the Judgment and Decree dated 10.07.2003 passed in O.S.No.316/93 on the file of the II Addl. Civil Judge (Senior Division), Bangalore Rural District, Bangalore, decreeing the suit for specific performance of agreement.
7
THESE APPEALS AND MISC. CIVIL COMING ON FOR HEARING THIS DAY, N KUMAR J., DELIVERED THE
FOLLOWING:
J U D G M E N T
These two appeals are preferred by defendants 2 to 4
against the judgment and decree of specific performance of
the agreement of sale granted by the trial Court.
2. For the purpose of convenience, the parties are
referred to as they are referred to in the original suit.
3. The subject matter of the suit is agricultural
lands bearing Sy.No.108 measuring 7 acres 20 guntas,
Sy.No.109 measuring 5 acres 33 guntas, Sy.No.112
measuring 10 acres and Sy.No.113 measuring 5 acres 24
guntas, all situated in Thylagere Village, Kundana Hobli,
Devanahalli Taluk, Bangalore District and bounded within
the boundaries mentioned in the schedule (hereinafter
referred to as the schedule property).
8
4. The first defendant Smt. Hanumakka is the
absolute owner of the schedule property. The case of the
plaintiff is that she entered into an agreement on 05.11.1990
agreeing to sell the aforesaid 28 acres 37 guntas of land in
favour of the plaintiff for a sum of Rs.3,47,100/-. The
plaintiff paid a sum of Rs.1,75,000/- to the defendants. On
the same day, the defendants delivered possession of the
schedule property to him. Her son by name Ashwathappa
has also attested the agreement of sale dated 05.11.1990.
The first defendant agreed to execute the sale deed as soon
as survey and durast work of the suit schedule property was
carried out. She also agreed to complete the sale transaction
within thirteen months from the date of the agreement. The
plaintiff was always ready and willing to perform his part of
the obligation. He was ready with the balance sale
consideration. He requested the first defendant more than a
dozen time to come and execute the sale deed. The first
defendant under one pretext or the other evaded to execute
the sale deed. The plaintiff during 1993 got issued two legal
9
notices to the defendants. Though the first defendant
received the said notice, she neither replied nor complied
with the demand made therein. Right from the date of
execution of the agreement, the plaintiff was ready to
perform his part of the obligation as contemplated under the
agreement. It is the defendants who were evading to execute
the sale deed. Pursuant to entering into the agreement, the
plaintiff has developed the land by investing huge lot of
money i.e., he has raised mango groves and he has also
leveled the entire land by using the bulldozer and also made
preparation to fence the entire land for which purpose he
has invested lot of money. The defendants even to this day
have not made any attempt to disturb the possession of the
suit schedule property. The first defendant has not executed
the sale deed. The suit was originally filed only against the
first defendant. Subsequently, an application was filed for
impleading second defendant, which was allowed.
Thereafter, the plaintiff filed an application for impleading
defendant Nos.3 and 4. It was also allowed. After they were
10
impleaded the plaintiff amended the plaint by adding para-
5(a). The second defendant has purchased item (c) of the
suit schedule property from the Power of Attorney holder of
the first defendant. The first defendant has executed a
General Power of Attorney in favour of one Sri Amit Gupta on
22.07.1992. On 29.08.1992 it was revoked. On the day
Amit Gupta conveyed the property to the second defendant
the General Power of Attorney was not in existence and Amit
Gupta had no power to convey the property. Even though he
has conveyed the property, it would not create or confirm
any better right, title or interest in favour of the second
defendant. The second defendant cannot claim that she had
become absolute owner of the property by virtue of the sale
deed dated 05.10.1993. By virtue of the agreement dated
05.11.1990 the plaintiff had no subsisting right over the
property in question. The sale deed in favour of the second
defendant would in no way affect the right of the plaintiff
over the suit property. The agreement dated 05.11.1990 has
not been terminated till the filing of the suit. Therefore, the
11
first defendant by herself or through her agent have no right
to convey the suit schedule property in favour of the second
defendant and the alleged sale deed do not bind the right of
the plaintiff in any manner nor affect his interest in any
manner. The first defendant has sold the first item of the
suit schedule property in favour of the third defendant under
a sale deed dated 15.02.1992. The first defendant on
26.06.1992 has also sold the ‘B’ and ‘D’ schedule properties
in favour of defendant No.4 by executing another sale deed
and getting it registered. The first defendant has not
disclosed the said alienation made by her in the written
statement placed by her in the year 1996. As such her
conduct in that regard is depricable. The plaintiff came to
know about the alienation in favour of defendant Nos.3 and
4 only during third week of June 1999. Thereafter he made
an application under Order 1 Rule 10(2) CPC for impleading
the purchasers as additional defendants in the above case,
which application was allowed. That is how they are arrayed
as defendants 3 and 4 in the suit. Defendants 3 and 4 have
12
purchased the property under two registered sale deeds. The
said sale deeds are subject to the final result of the case
since they came to picture after the agreement of sale dated
05.11.1990. The sale deeds dated 15.02.1992 and
26.06.1992 will not take away the right vested with the
plaintiff to get a decree for specific performance of the
agreement dated 05.11.1990. The said sale deeds are void
abinitio. They have been created by the first defendant in
favour of the defendant No.3 and 4 in order to defeat the
rights of the plaintiff under the agreement dated 05.11.1990.
The said documents are collusive, executed with an intention
to defraud the plaintiff and therefore, the plaintiff sought for
a decree for specific performance of the agreement dated
05.11.1990. Subsequently, by way of an amendment of the
prayer column, he sought for a direction directing the
defendant Nos.1, 3 and 4 to execute the sale deed jointly in
favour of the plaintiff in pursuance of the agreement dated
05.11.1990 and put the plaintiff in lawful possession of the
suit schedule property.
13
5. After service of summons, the first defendant
has filed the written statement. She admitted execution of
the agreement dated 05.11.1990 agreeing to sell the suit
property for a consideration of Rs.3,47,100/-. However, it is
her specific case that only a sum of Rs.75,000/- was paid
under the agreement and not Rs.1,75,000/- as alleged by
the plaintiff. It is her further case that plaintiff inserted Rs.1
Lakh in between the words “agreement” thereby tampering
the valuable agreement. She denied that she agreed to
execute the registered sale deed after survey and durasth
work of the suit schedule property. She denied that 13
months is the period agreed upon for completing the sale
transactions. It is her case that time agreed was only three
months from the date of agreement, but the plaintiff failed to
obtain sale deed within the stipulated period in spite of
repeated demands and requests made by the defendant.
Further, the plaintiff manipulated and tampered the
documents by inserting 13 months in place of 03 months.
The allegation that the plaintiff was ready and willing to
14
perform his part of the obligation arising out of the
agreement is an utter falsehood averred just for the purpose
of the suit. She admits the issue of legal notice and the
same has been replied to. The allegation that the plaintiff
has developed the lands by investing huge amounts and
raised mango fruits and he has also leveled the entire lands
by using buldozers and he has fenced the lands by spending
huge amounts are all denied as false. In fact there is already
mango groove in the land. The entire land has been fenced
and leveled and there is no need for the plaintiff to do these
works on the land. After the agreement, the plaintiff failed to
obtain the sale deed within the stipulated period and went
on postponing on one pretext or the other. Finally, he
expressed his inability to arrange funds and obtain sale deed
from the defendant. Hence, he agreed to take back the
advance amount and cancel the agreement. Though, the
defendant was entitled to forfeit the advance amount, she
has graciously returned the amount and got cancelled the
original agreement dated 05.11.1990. In fact, the suit
15
schedule property was sold to one Lakshmi Thammaiah of
Maddur and Padmini Raghavan under two separate sale
deeds registered in the office of the Sub-Registrar,
Devanahalli. The said land was sold much earlier to the
filing of the suit. Out of the sale consideration received by
the defendant, the advance amount has been returned to the
plaintiff by canceling the original agreement dated
05.11.1990. The defendant has executed a separate
document canceling the original agreement and also
acknowledged having received or having taken return of the
advance amount from the defendant. This document is in
accordance with oral understanding reached by plaintiff and
defendant when plaintiff was unable to perform his part of
the agreement. The said document dated 13.08.1992
cancelling of the original agreement dated 05.11.1990 was
produced as Annexure – ‘X’ to the written statement. The
defendants are in peaceful possession and enjoyment of the
suit schedule property. The plaintiff suppressing the
material facts of cancellation of the earlier agreement
16
between him and defendant and by inserting words in
between the lines and making material alterations filed the
suit. The plaintiff has not made proper parties to the suit.
Even if decree or order is made against the defendant, the
same is infructuous as she is not the owner of the suit
schedule property on the date of filing of the suit.
6. The second defendant filed an application to
implead herself in the suit. The application was allowed.
Thereafter, she filed her written statement.
7. She has stated that she has purchased the land
bearing Sy.No.112 referred to Schedule Item No.C of the suit
schedule property measuring to an extent of 10 acres
situated at Thylagere Village, Kundana Hobli, Devanahalli
Taluk, Bangalore Rural District for a valuable consideration
of Rs.1,70,000/- by a registered sale deed dated 05.10.1993.
Ever since the date of purchase, she is in possession and
enjoyment of the land in question. After purchase, she filed
17
an application before the Deputy Tahasildar of Devanahalli
Taluk with a request to change the khatha in her favour.
The Tahsildar had issued an endorsement dated 12.10.1995
stating that the plaintiff has filed the Original Suit No.
316/1993 before the Court. He has obtained an order of
temporary injunction which has been extended from
15.01.1995 till further orders. Therefore, the khatha cannot
be changed till the disposal of the suit. Till the said
endorsement was served on her, she was not aware of the
suit filed by the plaintiff. She preferred an appeal against
the order of the Deputy Tahsildar dated 12.10.1995 before
the Assistant Commissioner. The appeal was registered as
No.206/1995-96. She also stated that Item Nos. ‘B’ and ‘D’
schedule properties were sold to Sri V.T.Anand, the fourth
defendant in the suit, and item No.‘A’ schedule property was
sold to one Mrs.Lakshmithammaiah, the third defendant in
the suit, by a registered sale deed dated 15.02.1992, i.e.,
much prior to the institution of suit by the plaintiff.
Subsequently, khatha was also changed in favour of the
18
defendant by an order dated 21.09.1993. In view of the said
facts, the suit is not maintainable for mis-joinder and non-
joinder of parties. Therefore, she sought for dismissal of the
suit.
8. Defendants 3 and 4 who are impleaded on an
application filed by the plaintiff also filed their written
statement. They admitted the sale deed executed by the first
defendant in their favour. They have pleaded their complete
ignorance regarding the agreement dated 05.11.1990 and
the alleged payment of Rs.1,75,000/- by the plaintiff to the
first defendant. They denied that the plaintiff was put in
possession under the agreement of sale. They have denied
all the allegations in the plaint. They have denied the
plaintiffs possession over the suit schedule property. The
sale deeds have been executed by the first defendant in
favour of these defendants in accordance with law and these
defendants are bonafide purchasers for valuable
consideration without knowledge of the alleged agreement of
19
sale in favour of the plaintiff and therefore, the plaintiff has
no right to question the sale in favour of defendants. There
is no fraud in the purchase of item (a), (b) and (c) of lands by
these defendants. The suit for specific performance being a
discretionary relief, cannot be granted in favour of the
plaintiff as the plaintiff has not approached this Court
immediately on the expiry of 13 months in terms of the
alleged agreement of sale, even assuming that such an
agreement is there, but not conceding. In the meanwhile
third party interest having been created, he cannot maintain
the suit. The plaintiff having slept over the matter cannot
after the sale through proper registered documents being
effected in favour of these defendants, question the same.
The relief of specific performance cannot be granted as it
works out adversely to the interest of these defendants.
9. The plaintiff has filed a rejoinder to the written
statement of the first defendant. The allegation that the
original agreement of sale is tampered was denied. It is the
20
defendant who got the document prepared. In fact, some
corrections were there in the first page of the agreement and
thereafter she has attested those corrections by signing the
paper which clearly goes to show that no tampering has
been done by the plaintiff. The defendants have taken a
contention that the agreement dated 05.11.1990 is cancelled
on 13.08.1992 by the plaintiff himself which is denied as
false. The plaintiff has not executed any document on
13.08.1992. The document dated 13.08.1992 is concocted,
forged, fabricated document created by the defendants solely
with an intention to defraud the plaintiff. The signature
contained on the alleged document is not that of the plaintiff.
A careful reading of the said document shows that there was
an Agreement between the parties on 04.10.1990 and that
the same has been cancelled. The consideration set forth in
the document is something else and receipts incorporated is
Rs.80,500/- and the said Stamp Paper do not contain the
signature of the stamp vendor and further it does not
disclose in whose name the stamp paper was purchased. It
21
clearly makes out that it is a concocted document. Similarly,
rejoinder was filed to the written statement of defendants 3
and 4 also. The defendants 3 & 4 were fully aware of the
agreement dated 05.11.1990 when they purchased the
portion of the suit schedule property under the sale deed
dated 15.02.1992 and 26.06.1992. Despite she ventured to
purchase a portion of the suit schedule property from the
alleged Power of Attorney Holder of Defendant No.1. In that
view of the matter, the sale deeds dated 15.02.1992 and
26.06.1992 obtained by the defendants 3 & 4 are not valid
sale deeds in the eye of law. Further, defendants 3 & 4 are
not bonafide purchasers for value without knowledge of
agreement sale dated 05.11.1990 and as such, they are not
entitled for protection of her right alleged to have been
accrued under the sale deed dated 15.02.1992 and
26.06.1992. He denied that the defendants are in
possession of the property. On the contrary, he contended
that after taking possession, he has developed the same by
investing huge amount of money towards leveling the
22
schedule property with the help of bulldozer and he has also
sunk a Well, fitted with Diesel Motor for lifting water in order
to grow crops in the property in question. He has also
planted about 2000 Mango Plants which are presently aged
about 11 years and are already yielding fruits. The
defendants 3 and 4 at the time of taking the alleged Sale
Deed dated 15.02.1992 and 26.06.1992 were quite aware of
the possession of the plaintiff over the suit schedule property
in pursuance of the agreement dated 05.11.1990 and also
the development already made by the plaintiff therein. The
contention of the defendants 3 and 4 that the plaintiff slept
over the matter and approached the Hon’ble Court after 13
months and as such, the plaintiff is not entitled to claim for
specific performance of the agreement dated 05.11.1990 is
incorrect. There is no delay and laches on the part of the
plaintiff in approaching the Court. Hence, he prayed for
decree of the suit.
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10. Subsequently, an additional written statement
came to be filed by defendants 3 and 4. They contend that
the prayer of the plaintiff for possession cannot be granted
as the suit has not been properly valued. Unless the plaintiff
pays the court fee, the plaintiff cannot file a suit for
possession and as such, defendants are in possession
pursuant to the sale deed in their favour, unless the sale
deeds are declared as null and void, the suit of the plaintiff is
unsustainable.
11. On the aforesaid pleadings, the trial Court
framed the eight issues and two additional issues.
“1. Whether the plaintiff proves that under the
agreement of sale dated 5.11.90 he has
paid Rs.1,75,000/- to the 1st defendant as
part consideration?
2. Whether the plaintiff proves that he was
put in possession of the suit properties in
part performance of the contract?
3. Whether the 1st defendant proves that the
plaintiff has paid only Rs.75,000/- as part
24
consideration under the agreement dated
5.11.90 and he has inserted figure ‘1’ and
made it to appear Rs.1,75,000/- and
thereby tampered or altered the suit
agreement?
4. Whether the plaintiff proves that the 1st
defendant had agreed to complete the sale
transaction within 13 months from the date
of agreement and the time was the essence
of the contract?
5. Whether the plaintiff proves that he was
always ready and willing to perform his
part of the contract and obtain a regular
sale deed and it is the 1st defendant who
has evaded to execute the sale deed?
6. Deleted.
7. Whether the plaintiff is entitled for the relief
of specific performance of the contract
dated 5.11.90 in respect of the four
properties described in the plaint schedule?
8. What decree or order?
Additional issues
1. Whether the defendants 2 to 4 proves that
they are the bonafide purchasers of the suit
schedule properties accordingly they were
25
put in possession of the suit schedule
property in pursuance of their respective
sale deeds executed by the 1st defendant?
2. Whether the plaintiff proves that
defendants 2 to 4 have purchased the suit
schedule property with knowledge of the
agreement of sale entered into between him
and defendant No.1 in respect of the suit
properties?”
12. The plaintiff in order to substantiate his claim
examined himself as PW-1 and also examined two attesting
witnesses to the agreement of sale as PWs.2 and 3. They
produced 17 documents which were marked as Exs.P1 to
P17. On behalf of the defendants, 1st defendant’s son and
also her power of attorney holder Sri.T.Ashwatappa was
examined as DW-1. 2nd defendant was examined as DW-2.
Dr.Ravi Raghavan was examined as DW-3. The power of
attorney holder of 1st defendant Sri.Amith Gupta was
examined as DW-4. Sri.V.T.Anand, the 4th defendant was
examined as DW-5 and Sri.B.R.Yogish was examined as DW-
26
6 and they have produced 29 documents which were marked
as Exs.D1 to D29.
13. The trial Court on appreciation of the oral and
documentary evidence on record held that the execution of
agreement of sale is admitted. The evidence of the plaintiff’s
witnesses coupled with the evidence of DW-1 shows that
there are no interpolations in the agreement of sale. It also
held that a sum of Rs.1,75,000/- was paid and possession
was delivered on the date of agreement of the sale. It held
that the 1st defendant has failed to prove that only
Rs.75,000/- was received under the agreement of sale and
not Rs.1,75,000/-. The 1st defendant has failed to prove the
interpolation pleaded by her in the written statement. It
recorded a finding that the plaintiff was put in possession on
the date of the agreement and continuously he is in
possession of the property. It held that the 13 months was
the period prescribed for completion of the sale transaction
from the date of the agreement and not three months.
27
Defendants 2 to 4 have failed to prove that they are the
bonafide purchasers for valuable consideration. Though no
specific issue was framed regarding limitation, as both the
parties argued on the basis of the material on record, it
recorded a finding that the suit is in time. Accordingly, the
suit for specific performance was decreed. Aggrieved by the
said judgment and decree of the trial Court, 2nd defendant
has preferred RFA 1242/2003 and defendants 3 and 4 have
preferred RFA No.1312/2003.
ARGUMENTS
14. Sri B. V. Acharya, learned Senior Counsel
appearing for the appellants-defendants 3 and 4 contended
as under:-
(a) A bare perusal of the suit agreement discloses two
types of interpolations. First interpolation is by typing.
The second interpolation is by writing in hand. The
interpolation is regarding material terms of the
contract. The contract should have been completed
28
within three months and only Rs.75,000/- was paid
under the agreement. Now the interpolation is as if
Rs.1,75,000/- was paid and 13 months was agreed
upon. In fact, careful reading of the agreement shows
that out of the balance amount, Rs.1,00,000/- has to
be paid within 13 months and balance amount has to
be paid within three months thereafter and before
registration. In fact in the legal notice issued, the
reference is only to the payment of Rs.1,75,000/- and
13 months. Absolutely, there is no reference to the
subsequent clauses which are in writing. Similarly, in
the plaint, there is no reference to that condition. It
clearly demonstrates the interpolations of the suit
document. It is settled law that once there is
interpolation, the document gets vitiated and the
question of enforcing an agreement would not arise.
He also submits that a specific performance being the
discretionary relief, the conduct of the parties assumes
importance.
29
(b) When the suit was filed on 22.10.1993, in pursuance
of the sale deed executed in favour the defendants 3
and 4, mutation entry had been made on 20.9.1993.
The plaintiff produces the RTC’s of the year 1990
which shows the 1st defendant as the owner. If the
plaintiff had the RTC records on the date of the suit, it
would have shown the purchaser’s name. The plaintiff
files a suit and also files an application for temporary
injunction and the trial Court acting on the said RTCs
produced, grants an injunction restraining the 1st
defendant from alienating the property by which time,
1st defendant had already alienated the property in
favour of defendants 2 to 4 and therefore, he submits
that this conduct of the plaintiff disentitles him from
seeking the discretionary relief.
(c) When the 1st defendant filed the written statement on
20.2.1994, it is categorically mentioned that she has
already sold the property in favour of defendants 2 to
4, but still the plaintiff did not chose to implead the
30
defendants. It is the 2nd defendant who filed the
application on 27.11.1995 which was allowed. Still,
the plaintiff did not attempt to implead defendants 3
and 4. Immediately thereafter, defendant No.2 filed
written statement with reference to the sale deed in
favour of defendants 3 and 4. It is only on 2.8.1999
when plaintiff filed an application for impleadment of
defendants 3 and 4, by which time, nearly six years
had elapsed. Defendants 3 and 4 were impleaded on
6.8.2000 and therefore, the suit against them is clearly
barred by the law of limitation.
(d) The defendants have specifically contended that they
are the bonafide purchasers for valuable
consideration. In the entire plaint, there is no
allegation that the defendants 3 and 4 were aware of
the agreement. Even otherwise, the evidence on
record shows that the plaintiff was totally unaware of
the sale deeds and as such, the sale in favour of
defendants 3 and 4 is not vitiated and they are not
31
bound to execute the sale deed in favour of the
plaintiff.
(e) Though the agreement of sale is dated 5.11.1990, the
legal notice was issued on 19.1.1993 nearly after two
years. There is absolutely no material on record to
show that the plaintiff made an attempt to complete
the transactions during the stipulated period. It is
because the said agreement of sale has been cancelled
by an agreement dated 19.8.1992. Therefore, the suit
filed at a belated stage even against the 1st defendant,
though in time, is liable to be dismissed on the ground
of delay and laches.
(f) Lastly it was contended that there is absolutely no
evidence on record to show that the plaintiff was ready
and willing to perform his part of the contract, he was
ready with the balance sale consideration and he
tendered balance sale consideration to the defendants.
The trial Court has not properly appreciated the
32
evidence on record and has blindly decreed the suit of
the plaintiff which requires to be interfered with.
15. Sri Udaya Holla, learned Senior Counsel
appearing for the 2nd defendant adopting the aforesaid
arguments contended that the 2nd defendant has purchased
the ‘A’ schedule property for valuable consideration. She
was put in possession. The sale was effected after the
cancellation of agreement of sale. The very fact that she was
not made a party by the plaintiff and she had to get herself
impleaded and contest the claim shows lack of bonafides on
the part of the plaintiff. He submits that the suit agreement
is tampered, interpolated and the said agreement is also
cancelled. Therefore, the decree for specific performance is
unsustainable in law.
16. Per contra, Sri S. Vijaya Shankar, learned
senior Counsel appearing for the plaintiff submitted that
execution of suit agreement is admitted. It is true that there
33
are some corrections. It is after the corrections 1st defendant
has affixed her signature. Plaintiff and his two witnesses
have spoken about these corrections and consent of the 1st
defendant. Therefore, merely because the document was
corrected, it does not vitiate the agreement and the case of
tampering the document is not proved. The 1st defendant
who set up the plea has not entered the witness box.
Similarly, the period agreed upon is 13 months. In fact, in
reply notice by the defendants, it is clearly mentioned that
the 13 months is the period agreed upon and therefore, this
story of tampering is without any substance. Though a plea
of cancellation was set up in the written statement of the 1st
defendant, which was reiterated by the other defendants, the
said cancellation deed was not produced in evidence.
Plaintiff has specifically denied the execution of the
cancellation agreement. No witnesses who have attested the
cancellation deed have been examined and therefore, the
said cancellation deed is not proved. In the suit agreement,
there is a specific reference that the plaintiff was put in
34
possession of the property. Therefore, Section 53A of the
Transfer of Property Act is attracted. That apart in Exs.P16
and P17-notices issued by the revenue authorities to the
parties before surveying the property and fixing the
boundaries, it is clearly mentioned that the plaintiff is in
possession of the property on the date it was issued. Even
the evidence of the defendants in this case shows that they
are not in possession. In those circumstances, the finding
recorded by the trial Court that the plaintiff is in possession
of the property cannot be found fault with. Defendants 3 and
4 claim that they are the bonafide purchasers. The evidence
on record shows that before purchasing the property, they
did not go near the land, they did not enquire who were in
possession of the property. The said fact shows the
negligence and lack of good faith of the defendants and
therefore, it cannot be said that they are the bonafide
purchasers for valuable consideration. The trial Court was
justified in decreeing the suit even against them.
35
17. He also submitted that, before this Court an
application is filed under Section 21(1) of the Limitation Act
along with an application under Section 5 of the Limitation
Act to condone the delay in filing the said application.
Though in law the impleading applicants are considered as
parties to the suit from the day of service of notice of the
impleading application, in a given case, the Court has ample
power to condone the delay and treat the suit having been
filed against them in time. In the facts of the case, the case
is made out for condoning the delay and to treat the suit
against the defendants 3 and 4 having been filed in time. He
submits that for the aforesaid reasons, no case for
interference is made out.
POINTS FOR CONSIDERATION
18. In the light of the aforesaid facts and the rival
contentions, the points that arise for our consideration are
as under : -
36
(1) Whether the suit agreement of sale is interpolated
so as to render it void and unenforceable?
(2) Whether the plaintiff was ready and willing to
perform his part of the contract?
(3) Whether defendants 3 and 4 are bona fide
purchasers for valuable consideration without
notice of the agreement of sale in favour of the
plaintiff?
(4) Whether the application filed by the plaintiff in the
Appellate Court under Order XXI Rule (2) of CPC,
is maintainable and requires to be allowed or
whether the suit of the plaintiff is barred by
limitation in so far as defendants 3 and 4 are
concerned?
(5) Whether the suit of the plaintiff is liable to be
dismissed on the ground of delay and latches?
37
POINT No. (1) - EFFECT OF MATERIAL ALTERATION
19. The suit is one for specific performance of the
agreement of sale dated 5.11.1990. The consideration
agreed upon for sale is Rs.3,47,100/-. The extent of land
agreed to be sold is 28 acres 37 guntas, at the rate of
Rs.12,000/- per acre. The execution of this agreement is not
in dispute. What is contended is that in the agreement
material alteration has been made to which the vendor has
not agreed. Secondly, the said agreement is cancelled. It is
after such cancellation and after sale of the schedule
property to defendants 2 to 4 the agreement is altered and
on that basis the suit is filed. Therefore, the suit agreement
is unenforceable. The effect of making such an alteration
without the consent of the party bound is exactly the same
as that of cancelling the deed. The plaintiff has not
mentioned in the plaint about these alterations. However, in
his evidence he admits that the writing in the hand
happened in the presence of the first defendant. The first
defendant has consented for the same and accordingly she
38
has also signed. Therefore, the interpolation in Ex.P1-the
agreement of sale is admitted. Therefore, the question is,
whether the interpolation took place prior to the execution of
the agreement of sale and whether the first defendant has
given her consent for such alteration. Further, whether the
said alteration is a material alteration so as to render the
deed void, if it is proved that the alteration has been made
without the consent of the first party.
20. In order to prove this agreement with alteration,
plaintiff in his evidence in chief has not whispered a word
about this alteration. It is only in the cross-examination at
para 8 after identifying the agreement which is marked as
Ex.P1 admits that in the first page of the agreement there is
a writing in the pen and it was written in the presence of the
first defendant. He has not made any corrections. The said
writing/correction was marked as Ex.P1(a). He asserts that
the said writing was done in the presence of the first
defendant. First defendant has affixed his signature
39
consenting for the said correction. He identifies her LTM as
Ex.P1(b). Her son one Ashwathappa also has signed at
Ex.P1(c). One Annayappa has affixed his signature at
Ex.P1(d), Srinivasagouda at Ex.P1(e) and K.Govindaraju at
Ex.P1(f). He further admits that Ex.P1 was got prepared and
written by the first defendant’s son by name Ashwathappa
who is examined in this case as DW1. Before the first
defendant affixed her signature to Ex.P1, it was read over to
her. One Swamy, advocate, also has signed the said Ex.P1
as the scribe. She has deposed that the first defendant’s son
is the author of that writing in the pen.
21. In support of his case, he has examined PW2-
Narayanappa. He has stated in the examination in chief that
the writing in ink was there before the first defendant
executed Ex.P1. In the cross-examination, he states that
Ex.P1 is in handwriting. He has signed the said document.
Thereafter, he goes back on that statement and states that
Ex.P1 is type written. In the cross-examination, he also
40
asserts that Ex.P1 was got typed by DW1 the first
defendant’s son.
22. PW3-one Sri C. M. Srinivasagouda, another
witness to Ex.P1, admits that, in Ex.P1 there is a writing in
ink. It is after the said writing the first defendant has affixed
her signature. She has affixed her signature at the place
where the correction is made. The first defendant after
getting the document read over and agreeing to the contents
of the same has affixed her signature. In the cross-
examination he deposes that he is not aware where the
Ex.P1 was typed.
23. DW1-the son of the first defendant has been
examined as the Power of Attorney Holder of the first
defendant. In his examination in chief he has stated that,
when the transaction took place, three months was the
period mentioned for completion of the transaction. Because
the first defendant did not find time to complete the sale
41
transaction, it became 13 months. He admits in his cross-
examination that there are corrections in Ex.P1. His mother
has affixed her signature. Nowhere in his evidence, he has
stated that he has made the correction. None of these
witnesses who are said to be present at the time of execution
of Ex.P1 though admit the corrections in Ex.P1 in ink in
handwriting, they do not whisper about who is the author of
these alterations and corrections. If the evidence of DW1 is
to be believed, the period stipulated for completion of the
sale transaction is three months. It is because they could
not find time to complete the transaction, it became 13
months. Therefore, the said alteration was not there on the
day the document was executed, but the alteration obviously
is made after the expiry of the three months period as they
could not complete the transaction. If that evidence is to be
believed, then the evidence of PWs 1 to 3 falls to ground.
24. It is an admitted fact that the first defendant is
an illiterate lady. She has affixed her LTM. The plaintiff says
42
he has studied up to 7th standard. The document bears the
seal of one Kandaswamy, B.Com, B.L, Advocate and above
the seal it is written as “drafted by me”. The plaintiff also
admits to this fact, i.e., Ex.P1 is drafted by an advocate. The
document is in Kannada. It is typed. The evidence of all
these witnesses show that it is DW1, the son of the first
defendant, who got this agreement prepared, typed and
brought for execution. The advocate who drafted the
agreement was not present at the time of execution of the
agreement. If any corrections were to be made in the said
agreement before execution and if he was present, being the
draftsman of the agreement, the corrections should have
been in his handwriting. It is nobody's case that the writing
found in Ex.P1 is in his handwriting. Though PW1 in his
evidence says that the said writing is in the handwriting of
DW1, DW1 has not stated so. Therefore, who is the author
of this corrections is a mystery, which is not explained. The
argument is that before the first defendant put her LTM to
the document, this correction was made with her consent.
43
She, in token of her consent, has affixed her LTM near the
said corrections. Therefore, it is immaterial who made the
corrections, but she is a consenting party to the corrections
and therefore the said corrections do not vitiate the
document.
25. In order to appreciate this contention, it is
necessary to look at the original agreement and find out
where this LTM is put. Is it a LTM put in token of
consenting for corrections or is it a LTM which is put in the
normal course. The agreement runs to 3 pages. In the first
page, at the bottom on the right side, we find there is a LTM
of Smt. Hanumakka. The LTM is not clearly visible. If that
should be construed as execution of the agreement, in page
No. 2 we do not find the LTM of Hanumakka at the bottom
on the right side. However, we find one LTM in the left
margin of page No.1 at the center. The place where that LTM
is put is not the place where this correction in ink is made.
The said LTM is put roughly after 8 lines from the correction
44
in the center of the page. If a LTM in the center of the page
is to be construed as a consent for the corrections, in page
No.2 also we find one such LTM where there are no
corrections. If LTMs are taken in the left margin in the
center even at the place where there are no corrections, the
only inference that could be drawn is that those LTMs is the
proof of execution of the document. In fact, the LTMs found
at the left margin of page No.1, page No.2 and at the end of
writing at page No.3 are alike, whereas the so called LTM of
the first defendant at the bottom of page No.1 on the right
side has no similarity with the same. The evidence of DW1,
the son of the first defendant makes it clear, that the
alteration is made after the expiry of three months period as
they could not complete the transaction within three
months. Therefore, it is not possible to hold from the
aforesaid undisputed material on record that the LTM on the
left margin in page No.1 is affixed by the first defendant in
token of her consent for the corrections made in hand and
ink, at the time of execution of the agreement.
45
26. Then, let us see what are the corrections, how
did the document read before the corrections and how does
the document read after corrections and does it amount to
material alteration. What is typed in the document discloses
that, “out of Rs.3,47,100/- this day in the presence of the
witnesses Rs.75,000/- has been received as advance. The
balance sale consideration of Rs.2,72,100/- would be paid in
about 6 months from the date of execution of the agreement.”
Thereafter, at the cost of the vendee he is entitled to get the
document registered. If he commits breach, the advance
amount will not be refunded. The agreement also stands
cancelled. The interpolation is of two types. One is by typing.
Second one is by hand writing. A careful perusal of the
agreement shows that, before the word “75,000-00”, “1”
appears to have been typed subsequently. Thereafter, after
the word “75,000-00” the word “Lakh” has been typed
subsequently and in the next line the word “the” has been
typed subsequently. The resultant position is, originally it
was mentioned that 75,000-00 has been received as
46
advance. In the next line when the word “1,72,100-00” is
mentioned in Kannada, it is typed as “1,72,000-00”.
Whereas, in the earlier portion, the word “1,00,000-00” is
conspicuously missing and the word used is “Lakh”. This is
an interpolation by typing. Then we have the interpolation
in ink. The word “6” has been struck off. In its place “13” is
mentioned in Kannada language. In the bracket “3” is
mentioned in writing and in the bracket also “3” is
mentioned. Below that also “3” in writing and “3” in words
are mentioned. After mentioning the same, again there is a
interpolation mentioning in Kannada “Hadi” meaning “13”
and “1” is added which is clearly visible because it is beyond
the circle. Now, with the correction in ink it reads as
under:-
“Within 13 months 1,00,000-00 is to be paid and
the balance amount should be paid within 3
months”.
47
27. In other words, the time stipulated for
completing the transaction is 16 months and not 13 months
as contended by the plaintiff. In fact, this last alteration read
properly would make no sense. In one breadth it says that
Rs.1,00,000/- is to be paid within 13 months. In another
breadth it means after paying Rs.1,00,000/-, balance
amount is to be paid within 3 months and then document is
to be registered. It only shows that even while making this
alteration they are not clear about what they really intend to
alter as those alterations appear to have been done in
installments. There is no coherence even in the alterations.
28. Now, in this background, we have to find out in
the first place whether this alteration is a material alteration.
In an agreement of sale, the material terms of the contract
are, the total consideration agreed upon, how the said
consideration is to be paid and the period within which the
consideration is to be paid. There is no alteration in the
instant case about the total consideration which is
48
Rs.3,47,100/-. Before this alteration what is typed is, Rs.
75,000/- is paid as advance. If that Rs. 75,000/- is altered
as Rs. 1,75,000/- certainly it makes a lot of difference and if
it is an alteration without the consent of the first defendant,
it is a material alteration. Similarly, if the balance amount
payable is Rs.2,72,100/- and if it is now altered to mean
Rs.1,72,100/-, it is yet another material alteration. Further,
as typed 6 months is the period prescribed for completing
the sale transaction. If three months is the period agreed
upon in place of 6 months which appears to be the case and
if it is altered as 13 months, it is yet another material
alteration. Therefore, unless the plaintiff proves that the
first defendant has consented for these material alterations,
the agreement gets vitiated, the said alterations render it
void and in law it has the effect of cancelling the deed of sale.
29. It is in this context it is necessary to look at the
conduct of the parties after the execution of this agreement.
Ex.P5 is the legal notice issued on behalf of the plaintiff
49
before filing the suit. In the legal notice there is no whisper
about this alteration. On the contrary it is stated that a sum
of Rs.1,75,000/- is paid by the plaintiff to the defendant and
it is mutually agreed that the sale transaction should be
completed within 13 months. The plaintiff approached the
first defendant more than 10 times and she went on evading
the execution of the document. The notice is dated
19.1.1993. If this alteration was there in the document on
the day the legal notice is issued as the recitals with this
correction stand, the plaintiff ought to have paid a sum of
Rs.1,00,000/- within 13 months and the balance amount
had to be paid within 3 months thereafter at the time of
registration. There is no whisper about the agreement to pay
Rs.1,00,000/- within 13 months from the date of the
agreement or the said amount being tendered to the first
defendant. Similarly, one more notice came to be issued on
21.1.1993 as per Ex.P8. Even in this notice there is no
whisper about the obligation to pay Rs.1,00,000/- within 13
months from the date of the agreement and obligation to pay
50
the balance amount within 3 months thereafter and at the
time of registration. Therefore, it is clear that the aforesaid
corrections and alterations are made subsequent to the said
legal notice and before filing of the suit.
30. In fact, after service of summons, the defendant
has entered appearance and she has filed the written
statement. In the written statement she has categorically
stated that it is false to say that the plaintiff paid a sum of
Rs.1,75,000/- on the date of the agreement. It is her specific
case that he paid only a sum of Rs.75,000/- under the
agreement and not Rs.1,75,000/-. The plaintiff inserted
Rs.1,00,000/- in between the words, thereby tampering the
valuable agreement. Further she has stated that the time
agreed was only three months from the date of the
agreement, but, the plaintiff failed to obtain sale deed within
the stipulated period in spite of repeated demands and
requests made by the defendant to obtain the sale deed.
Further, the plaintiff manipulated and tampered the
51
documents by inserting 13 months as the period agreed
upon in place of 3 months and therefore at the earliest point
of time when the said tampering was brought to her notice,
she has made her stand very clear. This assumes
importance, because she has not entered the witness box.
She has executed Power of Attorney to her son DW1 who has
deposed before the Court giving a go-bye to the stand taken
by his mother. In fact, he admits that 3 months was the
period prescribed for completing the sale transaction. As
they could not complete the sale transaction it became 13
months. Therefore, the evidence on record shows that the
period agreed upon is 3 months. It is altered subsequently.
It is altered according to DW1 obviously after the period of 3
months when they could not complete the sale transaction.
Therefore, the argument that on the day the agreement was
executed, these alterations, corrections in handwriting and
in ink were very much in existence and accepting the said
corrections the first defendant executed the agreement is
disproved. Coupled with the fact, as to who is the author is
52
not spoken to. When the plaintiff says it is DW1 who is the
author of the corrections, DW1 has not stated so and even
there is no suggestion to him to that effect, though on the
day he was giving evidence he has been won over by the
plaintiff.
31. In this background, the question that arises for
our consideration is, what is a material alteration and what
is the effect of such alteration in a deed.
32. In paragraph 1378 of Volume 12 of Halsbury's Laws
of England (Fourth Edition) it is observed as under:-
"if an alteration (by erasure, interlineation, or
other- wise) is made in a material part of a deed,
after its execution, by or with the consent of any
party to or person entitled, under it, but without
the consent of the party or parties liable under it,
the deed is rendered void from the time of the
alteration so as to prevent the person who has
made or authorised the alteration, and those
claiming under him, from putting the deed in suit
53
to enforce against an party bound by it, who did
not consent to the alteration, any obligation,
covenant, or promise thereby undertaken or
made.
. A material alteration, according to this
authoritative work, is on which varies the rights,
liabilities, or legal position of the parties as
ascertained by the deed in its original state, or
otherwise varies the legal effect of the instrument
as originally expressed, or reduces to certainty
some provision which was originally
unascertained and a such void, or which may
otherwise prejudice the party bound by the deed
as originally executed.
The effect of making such an alteration
without the consent of the party bound is exactly
the same as that of cancelling the deed.”
33. The Privy Council in NATHU LAL vs.
MUSSAMAT GOMTI KAUR [AIR 1940 SC 160] has held as
under : -
54
“A deed is nothing more than an instrument
or agreement under seal; and the principle of
those cases is that any alternation in a material
part of any instrument or agreement avoids it,
because it thereby ceases to be the same
instrument.”
Again the Judicial Committee observed as
under:-
“A material alteration has been defined in
the rule as one which varies the rights, liabilities
or legal position of the parties ascertained by the
deed, etc.,” and after applying that test they held
that the alteration in that case was not material
in the sense of altering the rights, liabilities or
legal position of the parties or the legal effect of
the document.”
34. The Supreme Court in the case of VALIAMMAL
RANGARAO RAMACHAR vs MUTHUKUMARASWAMY
GOUNDER AND ANOTHER [(1982) 3 SCC 508] held that, a
motivated interpolation in a solemn document completely
vitiates the document. Common course of human conduct has
55
uptil now indicated to us that solemn agreements have been
violated when more price is offered, but here is a breach
attempted for a lesser price and by a fairly crude attempt
which stares in the face. The interpolation is motivated
inasmuch as when translated it meant that the plaintiff who
seeks specific performance of his contract was aware of and
had the knowledge of an agreement which the vendor
appears to have entered into with original defendant 2.
There was hardly any explanation about the interpolation
offered to the High Court and in fact none was forthcoming to
us also.
35. The Apex Court in the case of
LOONKARAN SETHIYA AND OTHERS vs. MR. IVAN
E. JOHN AND OTHERS, [AIR 1977)SC 336] after referring
to the aforesaid passage of the Halsburys Law of England
observed that:
“a material alteration is one which varies the
rights, liabilities, or legal position of the parties,
as ascertained by the deed in its original state, or
56
otherwise varies the legal effect of the instrument
as originally expressed, or reduces to certainty
some provision which was originally
unascertained and as such void, or which may
otherwise prejudice the party bound by the deed
as originally executed. The effect of making such
an alteration without the consent of the party
bound is exactly the same as that of cancelling
the deed.”
After laying down the aforesaid law, applying the same
to the facts of that particular case it was observed as under:-
25. Now a comparison of Exh. A-I (produced by
the defendants first set) with Exh. 168 (produced
by the plaintiff) would show that besides the
obliteration of the word 'partner' from the
preamble as stated above, the plaintiff made two
other alterations in Exh.168. Originally, the
second proviso to sub-clause (8) of clause 1 of the
agreement stood as given in Exh. A-1 ran thus:-
"The payment for purchase of cotton will be made
on the first (emphasis ours) day of its receipt in
the mills of the partners."
57
26. In Exh 168, however, the word 'first' has
been changed into 'tenth' thus making it read as
"the payment for purchase of cotton will be made
on the tenth (emphasis ours) day of its receipt in
the mills of the partners."
27. The third alteration is no less important. As
would be evident from Exh. A-1, sub-clause (3) of
clause 12 of the agreement as actually drawn up
between the parties read as follows:-
“A commission of Rupee one percent
on value of all sales of products of the
above three spinning mills, viz. yarn, and
newar, whether sold directly by the
partners or otherwise but delivered and
produced during the currency of this
agreement.
28. After the alteration, the clause has been
made to read as follows on Exh.168:-
"A commission of Rupee one percent on value
of all sales of products of the above three
spinning mills, viz. yarn, and newar, whether
sold directly by the partners or otherwise but
58
delivered or produced during the currency of
this agreement."
29. As a result of the last change, the word
'and' has been substituted by the word 'or'.
30. As the above mentioned alterations
substantially vary the rights and liabilities as
also the legal position of the parties, they cannot
be held to be anything but material alterations
and since they have been made without the
consent of the defendants first set, they have the
effect of cancelling the deed. Question No.5 is,
therefore, answered in the affirmative.”
36. Therefore, once the evidence on record shows
that a material alteration is made in a deed, after its
execution, without the consent of the party liable under it,
the deed is rendered void from the time of the alteration so
as to prevent the person who has made or authorised the
alteration from putting the deed in suit to enforce against a
party bound by it, who did not consent to the alteration, any
obligation, covenant, or promise thereby undertaken or made
59
because the material alteration varies the rights, liabilities
and legal position of the parties as ascertained by the deed
in its original state. It varies the legal effect of the
instrument as originally expressed. It prejudices the party
bound by the deed as originally executed. The effect of
making such an alteration without the consent of the party
bound is exactly the same as that of cancelling the deed.
Therefore, as the above mentioned alteration substantially
vary the rights and liabilities as also the legal position of the
parties, they cannot be held to be anything, but material
alterations and since they have been made without the
consent of the first defendant, it has the effect of cancelling
the deed and it is unenforceable, as on the date of the suit in
law as the deed has become void and it is non est, i.e., not in
existence.
37. Dealing with this interpolation, the trial Court
held that, the first defendant did not step into the witness
box. On the other hand, she has examined the Power of
60
Attorney Holder who is her own son DW-1. He has clearly
deposed that on the date of the agreement it was settled that
the sale deed has to be executed within 3 months. Since
the required time for execution of the sale deed was extended
to 13 months, according to the learned trial Judge this
evidence of DW1 fully supports the case of the plaintiff, but
in no way helps the defence of defendant No.1. In the
evidence of PWs 1 to 3 they have stated that some
corrections were made with the pen in Ex.P1 agreement and
defendant No.1 has put her LTM on the said correction and
the said fact is also admitted by DW1 in his cross-
examination. In view of this clear admission by DW1, the
question of tampering by the plaintiff either consideration
amount or time fixed for execution of the sale deed will not
survive. On going through Ex.P1, undoubtedly there are
some corrections in Ex.P1, but those corrections are attested
by defendant No.1 by putting her LTM. So, under such
circumstances, Ex.P1 is not a tampered document. On the
other hand, in view of the admission of DW1 in his cross-
61
examination, it has to be held that Ex.P1 is the genuine
document and there are no material alterations in Ex.P1. In
view of the evidence of PWs1 to 3 and DW1 the stand taken
by the first defendant that there are material alterations in
Ex.P1 must fall to the ground and the said allegations of the
first defendant are baseless.
38. This finding is contrary to both oral and
documentary evidence on record. Firstly, DW1 has clearly
deposed that 3 months was the period prescribed for
completing the sale transaction. Further, he has specifically
deposed that as they could not complete the sale transaction
it became 13 months. Therefore, on the day the agreement
was executed, the period prescribed was only 3 months and
not 13 months. It is only after the expiry of 3 months when
they were unable to complete the transaction it became 13
months. Therefore, this interpolation of 13 months
introduced in the suit document is only after the expiry of 3
months period and it was not there on the day the
62
agreement was executed. This aspect was not noticed by the
trial Judge. This evidence of DW1 on which the plaintiff
relies on clearly establishes the case of interpolation.
39. Secondly, the plaintiff has not produced any
independent evidence to show the payment of Rs.1,75,000/-.
When the defendants have clearly demonstrated the
interpolation and now that the interpolation is also admitted
by the plaintiff and his witnesses and the finding of the trial
Court also is to that effect, the burden of showing that in
terms of the interpolation, the plaintiff paid Rs.1,75,000/- to
the first defendant was squarely on him. Except the bear
assertion in the oral evidence of PW1 coupled with the
aforesaid interpolated recital nothing else is produced before
the Court to substantiate the contention that either the
interpolation was acted upon or a sum of Rs.1,75,000/- is
paid. The trial Judge has not carefully scrutinized the suit
document. It shows not only the interpolation in
handwriting, there is an interpolation even by way of
63
typewriting. If the evidence of the plaintiff and his witnesses
is to be accepted, the first defendant has affixed her LTM
approving this interpolation on the left side margin. A
perusal of the document shows her LTM in the first page is
not found near the lines where this interpolation is made. It
is about 8 lines above that where there is no interpolation. If
affixing a LTM on the side margin of a page is proof of
acceptance of the interpolation, we find such a LTM in the
second page also in the left margin where there is no
interpolation at all. Therefore, this argument that this
interpolation took place even before execution and the first
defendant affixed her LTM in token of acceptance of this
interpolation falls to ground. This aspect also has not been
seen by the trial Judge. Therefore, the finding recorded by
the trial Court that there is no interpolation and these
interpolations are all done prior to the execution of the
document and that the first defendant has consented for
such interpolation by affixing LTM is contrary to the oral and
documentary evidence on record.
64
POINT NO.2 - READINESS AND WILLINGNESS
40. In a suit for specific performance the
plaintiff should not only plead and prove the terms of the
agreement, but also plead and prove his readiness and
willingness to perform his obligation under the contract in
terms of the contract.
41. Section 16 of the Specific Relief Act reads as
under: -
“16. Personal bars to relief.- Specific
performance of a contract cannot be enforced in
favour of a person-
(a) who would not be entitled to recover
compensation for its breach; or
(b) who has become incapable of performing, or
violates any essential term of, the contract that on
his part remains to be performed, or acts in fraud
of the contract, or wilfully acts at variance with,
or in subversion of, the relation intended to be
established by the contract; or
65
(c) who fails to aver and prove that he has
performed or has always been ready and willing
to perform the essential terms of the contract
which are to be performed by him, other than
terms the performance of which has been
prevented or waived by the defendant.
Explanation.- For the purposes of clause (c),-
(i) where a contract involves the payment of
money, it is not essential for the plaintiff to
actually tender to the defendant or to deposit in
court any money except when so directed by the
court;
(ii) the plaintiff must aver performance of, or
readiness and willingness to perform, the
contract according to its true construction.
42. This provision has been the subject matter of
interpretation by the Apex Court on several occasions:
66
43. The law on the point is well settled. The
Supreme Court in the case of N.P.THIRUGNANAM (DEAD)
BY LRS vs DR R.JAGAN MOHAN RAO AND OTHERS [(1995)
5 SCC 115] has held as under: -
“5. It is settled law that remedy for
specific performance is an equitable remedy and
is in the discretion of the court, which discretion
requires to be exercised according to settled
principles of law and not arbitrarily as
adumbrated under Section 20 of the Specific
Relief Act 1963 (for short, 'the Act'). Under Section
20, the court is not bound to grant the relief just
because there was valid agreement of sale.
Section 16(c) of the Act envisages that plaintiff
must plead and prove that he had performed or
has always been ready and willing to perform the
essential terms of the contract which are to be
performed by him, other than those terms the
performance of which has been prevented or
waived by the defendant. The continuous
readiness and willingness on the part of the
plaintiff is a condition precedent to grant the relief
of specific performance. This circumstance is
67
material and relevant and is required to be
considered by the court while granting or refusing
to grant the relief. If the plaintiff fails to either
aver or prove the same, he must fail. To adjudge
whether the plaintiff is ready and willing to
perform his part of the contract, the court must
take into consideration the conduct of the plaintiff
prior and subsequent to the filing of the suit along
with other attending circumstances. The amount
of consideration which he has to pay to the
defendant must of necessity be proved to be
available. Right from the date of the execution till
date of the decree he must prove that he is ready
and has always been willing to perform his part
of the contract. As stated, the factum of his
readiness and willingness to perform his part of
the contract is to be adjudged with reference to
the conduct of the party and the attending
circumstances. The court may infer from the facts
and circumstances whether the plaintiff was
ready and was always ready and willing to
perform his part of contract.”
68
44. The Supreme Court in the case of HIS
HOLINESS ACHARYA SWAMI GANESH DASSJI vs SITA
RAM THAPAR [(1996) 4 SCC 526] has held as under: -
“2. There is a distinction between readiness to
perform the contract and willingness to perform
the contract. By readiness may be meant the
capacity of the plaintiff to perform the contract
which includes his financial position to pay the
purchase price. For contract, the conduct has to
be properly scrutinised. There is no documentary
proof that the plaintiff had ever funds to pay the
balance of consideration. Assuming that he had
the funds, he has to prove his willingness to
perform his part of the contract. According to the
terms of the agreement, the plaintiff was to
supply the draft sale deed to the defendant
within 7 days of the execution of the agreement,
i.e., by 27.2.1975. The draft sale deed was not
returned after being duly approved by the
petitioner. The factum of readiness and
willingness to perform plaintiff's part of the party
and the attending circumstances. The court may
infer from the facts and circumstances whether
the plaintiff was ready and was always ready
69
and willing to perform his part of the contract. The
facts of this case would amply demonstrate that
the petitioner/plaintiff was not ready to perform
his part of the contract as he had no financial
capacity to pay the consideration in cash as
contracted and intended to abide for the time
which disentitles him as time is the essence of the
contract.”
45. The Supreme Court in the case of RAM AWADH
(DEAD) BY LRS AND OTHERS Vs ACHHAIBAR DUBEY AND
ANOTHER [2000 (2) SCC 428] interpreting section 16 of the
Specific Performance Act 1963 has held as under: :
“6. The obligation imposed by Section 16 is
upon the court not to grant specific performance to
a plaintiff who has not met the requirements of
clauses (a), (b) and (c) thereof. A court may not,
therefore, grant to a plaintiff who has failed to
aver and to prove that he has performed or has
always been ready and willing to perform his
part of the agreement the specific performance
whereof he seeks. There is, therefore, no question
of the plea being available to one defendant and
70
not to another. It is open to any defendant to
contend and establish that the mandatory
requirement of Section 16(c) has not been
complied with and it is for the court to determine
whether it has or has not been complied with
and, depending upon its conclusion, decree or
decline to decree the suit. We are of the view that
the decision in Jugraj Singh's case is erroneous.
46. The Apex Court in the case of P.D'Souza v.
Shondrilo Naidu [ 2004 (6) SCC 649] has held as under :
“It is indisputable that in a suit for specific
performance of contract the plaintiff must
establish his readiness and willingness to
perform his part of the contract. The readiness
and willingness on the part of the plaintiff to
perform his part of contract would also depend
upon the question as to whether the defendant
did everything which was required of him to be
done in terms of the agreement for sale. The
question as to whether the onus was discharged
by the plaintiff or not will depend upon the facts
71
and circumstances of each case. No straitjacket
formula can be laid down in this behalf.”
47. The Supreme Court in the case of ANIGLASE
YOHANNAN V. RAMLATHA (2005) 7 SCC 534 [SCC p 540,
para 12) has held as under:
“12. The basic principle behind Section 16(c) read
with Explanation (ii) is that any person seeking
benefit of the specific performance of contract
must manifest that his conduct has been
blemishless throughout entitling him to the
specific relief. The provision imposes a personal
bar. The Court is to grant relief on the basis of the
conduct of the person seeking relief. If the
pleadings manifest that the conduct of the
plaintiff entitles him to get the relief on perusal of
the plaint he should not be denied the relief.”
This Court further held that the averments
relating to readiness and willingness are not a
mathematical formula which should be expressed
in specific words and if the averments in the
plaint as a whole, do clearly indicate the
72
readiness and willingness of the plaintiff to fulfil
his part of the obligations under the contract, the
fact that the wording was different, will not
militate against the readiness and willingness of
the plaintiff. The above observations cannot be
construed as requiring only a pleading in regard
to readiness and willingness and not `proof'
relating to readiness and willingness. In fact, in
the very next para, this Court clarified that
Section 16(c) of the Act mandates the plaintiff to
aver in the plaint and establish the fact by
evidence aliunde that he has always been ready
and willing to perform his part of the contract.
Therefore, the decision merely reiterates the need
for both pleadings and proof in regard to
readiness and willingness of the plaintiff.
48. The Supreme Court in the case of M.M.S.
INVESTMENTS, MADURAI AND OTHERS Vs V.VEERAPPAN
AND OTHERS [2007 AIR SCW 4809] has held as under:-
“5. Questioning the plea of readiness and
willingness is a concept relatable to an
agreement. After conveyance the question of
73
readiness and willingness is really not relevant.
Therefore, the provision of the Specific Relief Act,
1963 (in short the 'Act') is not applicable. It is to
be noted that the decision in Ram Awadh's case
(supra) relates to a case where there was only
an agreement. After the conveyance, the only
question to be adjudicated is whether the
purchaser was a bona fide purchaser for value
without notice. In the present case the only issue
that can be adjudicated is whether the
appellants were bona fide purchasers for value
without notice. The question whether the
appellants were ready and willing is really of no
consequence. In Ram Awadh's case (supra) the
question of the effect of a completed sale was not
there. Therefore, that decision cannot have any
application so far as the present case is
concerned. Once there is a conveyance the
concept would be different and the primary relief
could be only cancellation.”
49. The Supreme Court in the case of AZHAR
SULTANA vs B. RAJAMANI AND OTHERS [AIR 2009 SC
2157] has held as under:-
74
“18. Section 16(c) of the Specific Relief Act, 1963
postulates continuous readiness and willingness
on the part of the plaintiff. It is a condition
precedent for obtaining a relief of grant of specific
performance of contract. The court, keeping in
view 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.
50. The Supreme Court in the case of MAN KAUR
(DEAD) BY LRS vs HARTAR SINGH SANGHA [(2010) 10
SCC 512] has held as under:-
“12. Section 16(c) of the Specific Relief Act 1963
(`Act' for short) bars the specific performance of a
contract in favour of a plaintiff
75
“who fails to aver and prove that he has
performed or has always been ready and
willing to perform the essential terms of the
contract which are to be performed by him
(other than terms of the performance of
which has been prevented or waived by the
defendant).
Explanation (ii) to section 16 provides that for
purposes of clause (c) of section 16,
“the plaintiff must aver performance of, or
readiness and willingness to perform, the
contract according to its true construction.
Thus in a suit for specific performance, the
plaintiff should not only plead and prove the
terms of the agreement, but should also plead
and prove his readiness and willingness to
perform his obligations under the contract in
terms of the contract.
51. Thus, Section 16(c) of the Act envisages that
plaintiff must plead and prove that he had performed or has
76
always been ready and willing to perform the essential terms
of the contract which are to be performed by him, other than
those terms the performance of which has been prevented or
waived by the defendant. The continuous readiness and
willingness on the part of the plaintiff is a condition
precedent to grant the relief of specific performance. This
circumstance is material and relevant and is required to be
considered by the court while granting or refusing to grant
the relief. If the plaintiff fails to either aver or prove the same,
he must fail. The basic principle behind Section 16(c) read
with Explanation (ii) is that any person seeking benefit of the
specific performance of contract must manifest that his
conduct has been blemishless throughout entitling him to the
specific relief. The provision imposes a personal bar. The
Court is to grant relief on the basis of the conduct of the
person seeking relief.
52. Thus in a suit for specific performance, the
plaintiff should not only plead and prove the terms of the
77
agreement, but should also plead and prove his readiness
and willingness to perform his obligations under the contract
in terms of the contract. The continuous readiness and
willingness on the part of the plaintiff is a condition
precedent to grant the relief of specific performance. This
circumstance is material and relevant and is required to be
considered by the court while granting or refusing to grant
the relief. If the plaintiff fails to either aver or prove the same,
he must fail. It is indisputable that in a suit for specific
performance of contract, the plaintiff must establish his
readiness and willingness to perform his part of the contract.
The readiness and willingness on the part of the plaintiff to
perform his part of contract would also depend upon the
question as to whether the defendant did everything which
was required of him to be done in terms of the agreement for
sale. The question as to whether the onus was discharged by
the plaintiff or not will depend upon the facts and
circumstances of each case. No straitjacket formula can be
laid down in this behalf. To adjudge whether the plaintiff is
78
ready and willing to perform his part of the contract, the
court must take into consideration the conduct of the plaintiff
prior and subsequent to the filing of the suit along with other
attending circumstances. The amount of consideration which
he has to pay to the defendant must of necessity be proved to
be available. Right from the date of the execution till the date
of the decree, he must prove that he is ready and has always
been willing to perform his part of the contract. As stated, the
factum of his readiness and willingness to perform his part of
the contract is to be adjudged with reference to the conduct
of the party and the attending circumstances. The court may
infer from the facts and circumstances whether the plaintiff
was ready and was always ready and willing to perform his
part of contract.
53. Readiness and willingness refer to the state of
mind and conduct of the purchaser, as also his capacity and
preparedness on the other. One without the other is not
sufficient. There is a distinction between readiness to perform
79
the contract and willingness to perform the contract. By
readiness may be meant the capacity of the plaintiff to
perform the contract which includes his financial position to
pay the purchase price. In so far as willingness is concerned,
it reflects the mental attitude of the plaintiff to part with or
pay the balance sale consideration agreed to be paid. If there
are any reservations without any justification, or it is made
conditional on the happening of any event which is not
agreed upon, it shows his unwillingness to perform his part of
the contract. The obligation imposed by Section 16 is upon
the court not to grant specific performance to a plaintiff who
has not met the requirements of clauses (a), (b) and (c)
thereof. A court may not, therefore, grant to a plaintiff who
has failed to aver and to prove that he has performed or has
always been ready and willing to perform his part of the
agreement the specific performance whereof he seeks. There
is, therefore, no question of the plea being available to one
defendant and not to another. It is open to any defendant to
contend and establish that the mandatory requirement of
80
Section 16(c) has not been complied with and it is for the
court to determine whether it has or has not been complied
with.
54. Therefore, it is necessary to see whether there is
a proper plea which satisfies the requirement of Section 16(c)
of the Specific Relief Act, 1963. In para 4 it is stated that the
plaintiff was ever ready and willing to perform his part of the
obligation and he was ever ready with the balance sale
consideration amount and that the plaintiff requested the
defendant more than a dozen times to come and execute the
sale deed. In para 5 of the plaint the plaintiff has averred
that right from the date of execution of the agreement he was
ready to perform his part of the obligation as contemplated
under the agreement. On the other hand the defendant had
evaded to execute the sale deed on one pretext or the other.
The plaintiff during 1993 had got issued two legal notices to
the defendant. Though the defendant received the said
notice, she never replied nor complied.
81
55. The 1st defendant has specifically traversed
these allegations. She specifically contends that the time
agreed was only three months from the date of the
agreement, but the plaintiff failed to obtain sale deed within
the stipulated period in spite of repeated demands and
requests made by the defendant to obtain the sale deed. The
averments in the plaint that the plaintiff was ready and
willing to perform his part of the obligation arising out of the
agreement is utter falsehood and are averred just for the
purpose of the suit. Further, it is stated that the averment
in para 5 of the plaint that the plaintiff was ever ready to
perform his part of the agreement and the defendant had
postponed the execution of the sale deed on one pretext or
the other was denied as false. It is because of these material
allegations in the plaint which were denied in the written
statement, issue No.5 in the suit was framed as under : -
“Whether the plaintiff proves that he was
always ready and willing to perform his part of
the contract and obtain a regular sale deed and it
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is the first defendant who has evaded to execute
the sale deed?”
Therefore, the plea of readiness and willingness to perform
the essential terms of the contract is found in the plaint.
56. In support of his plea of readiness and
willingness the plaintiff has adduced evidence. In his
evidence he stated that by employing bulldozers he got the
schedule land flattened, planted mango plants, dug a bore
well, installed a pump set at a cost of Rs.8,00,000-00. Within
13 months from the date of the agreement, he was in
possession of the balance amount payable under the
agreement of sale. He met the first defendant about 30 to
40 times in those 13 months. It is the first defendant who is
the cause for not completing the sale transaction. She was
expected to get the measurement of the property done which
she did not do. However, he was ready with the balance sale
consideration. Even on the day he was giving evidence he
was ready with the said amount. This is what he said in the
83
examination in chief. In cross-examination he deposed he
has no document to show that he was in possession of the
balance amount. However, he again asserted that he is in
possession of the balance sale consideration. Except this
evidence we have no evidence on record. In other words
except repeating these words that he was ready and willing
to perform his part of the contract in the witness box, he has
not placed any evidence on record to show that he was firstly
ready with the balance sale consideration and secondly he
was willing to part with the sale consideration to the first
defendant.
57. If the plaintiff after entering into the sale
agreement took possession of the schedule property under
the agreement and thereafter leveled the entire land by using
the bulldozers, dug a bore well, installed a pump set and
planted mango trees and spent nearly Rs.8,00,000-00
towards these expenses which is twice the amount of the
sale consideration, he should have produced evidence to
84
substantiate this fact. If he had employed a bulldozer to
level the entire land he should have paid money to the
owner of the bulldozer and obtained receipts even if cash
payment is made. Similarly, if a bore well is dug, there
should have been evidence to substantiate the said fact. If a
pump set had been installed, he should have had a receipt
evidencing the purchase of the said pump set. If he has
fenced the land, again there should be a receipt to show the
purchase of barbed wire because the land to be fenced is
about 28 acres 37 guntas. Except the oral assertion,
absolutely no scrap of paper is produced to substantiate this
fact. He has not said where he had kept that money. In
these days it is very difficult to keep so much cash in the
house. If he was ready with the balance sale consideration
and approached the 1st defendant 30 to 40 times in those 13
months period as spoken to by him, he could not have kept
the cash in the house. If he was really interested in
purchasing the property or at least when he issued a legal
notice and filed a suit, he would have deposited the amount
85
in some bank and could have produced documents showing
that he was ready with the balance sale consideration. At
least on the day he issued the legal notice or he filed the suit
or at least on the day he was giving evidence, he should have
demonstrated that he was ready with the balance sale
consideration. Absolutely no effort is made in this direction.
58. The plaintiff in order to succeed has to prove the
continuous readiness and willingness from the date of the
agreement till the date of hearing of the case. To adjudge
whether the plaintiff is ready and willing to perform his part
of the contract, the Court must take into consideration the
conduct of the plaintiff prior and subsequent to the filing of
the suit along with other attending circumstances. His
conduct should be blemishless throughout entitling him to
the specific relief. The mere assertion in the witness box
that he is ready and willing to perform his part of the
contract or he is ready with the balance sale consideration
would not meet the requirements of law. Seen from this
86
angle if we look into the evidence on record in the first place,
there is no evidence apart from the interpolated recital in the
suit agreement that he has paid Rs.1,75,000/- under the
agreement. The first defendant has admitted the receipt of
Rs.75,000/-. She has specifically denied the payment of
Rs.1,00,000/- and has contended that such a writing is an
interpolation. Therefore, in the first instance it was
necessary for the plaintiff to prove by acceptable evidence
other than the recital in the agreement that a sum of
Rs.1,00,000/- was paid in addition to Rs.75,000/- on
execution of the agreement of sale. Subsequently, 13
months is the period prescribed according to the plaintiff to
pay the balance sale consideration. Absolutely no evidence
is adduced to show that in these 13 months period the
plaintiff was ready with the balance sale consideration. It is
the specific case of the plaintiff that about 30 to 40 times
plaintiff approached the first defendant with the balance
consideration and requested her to execute the sale deed.
No evidence is coming forward to prove this fact of plaintiff
87
approaching defendant 30 to 40 times and during the said
period he had the balance sale consideration in his hand.
Two legal notices have been issued asserting readiness and
willingness to pay the sale consideration. But, no evidence
is adduced to show that on the day when these legal notices
were issued, the plaintiff was ready with the balance sale
consideration. Even after the filing of the suit till the day he
gave evidence in Court, no evidence is adduced to show
during that period that he was ready with the balance sale
consideration. It is the specific case of the plaintiff which is
averred in the plaint and also spoken to in his evidence that
after the agreement of sale, he has spent Rs.8,00,000/- for
the purpose of flattening the land, digging bore well,
installing a pump set, fencing the land and planting mango
trees. Absolutely no evidence is adduced to show that the
plaintiff was in possession of Rs.8,00,000/- and how much
he has spent out of Rs.8,00,000/- on these different heads
and from where he got the money. Therefore, the evidence
on record clearly establishes that the plaintiff has failed to
88
prove the possession of the balance sale consideration as
pleaded by him. There is absolutely no evidence on record to
show that he was willing to pay the said amount. When he
was not in possession of the amount at all, the question of
willing to part with that money would not arise. Therefore,
the plaintiff has failed to prove the legal requirement of
readiness and willingness to pay the balance sale
consideration. As the proof of readiness and willingness to
pay the sale consideration is a condition precedent for grant
of a decree of specific performance, the plaintiff has
miserably failed in this regard and therefore the plaintiff is
not entitled to the relief of specific performance.
59. The trial Court has proceeded on the basis that,
the evidence of PW2 and legal notices at Exs.P5 and P8
clearly goes to show that the plaintiff was/is ready and
willing to perform his part of the contract from the
agreement till the date of filing the suit and subsequently
also. Further it held that, in spite of service of notices the
89
defendant No.1 did not respond to the said notices. So
under such circumstances an inference has to be drawn that
the plaintiff was always been ready and willing to perform
his part of contract as per the agreement. Then, the trial
Court took note of the fact that, in the cross-examination of
DW1, it is elicited that the plaintiff after getting the
agreement approached the first defendant several times and
requested her to execute the sale deed by receiving the
balance consideration amount. So, the admission made by
DW1 in the cross-examination will cut the contention of the
defendants 2 to 4 that the plaintiff was not ready and willing
to perform his part of the obligation under the agreement
dated 5.11.1990.
60. This reasoning only demonstrates a very
superficial approach on the part of the trial Court in
appreciating the evidence. It failed to notice that mere
assertion in the witness box and issue of a legal notice is not
a proof of readiness and willingness to pay the balance sale
90
consideration. The plaintiff should not only aver, but also
prove the readiness and willingness to the satisfaction of the
Court. No inferences are permissible in law. Readiness and
willingness is purely a question of fact. The plaintiff has to
produce before the Court such evidence so as to satisfy the
Court that he was ready with the balance sale consideration
and he was willing to part with the balance sale
consideration. As set out above, the evidence on record
clearly demonstrates he was neither ready with the balance
sale consideration nor he made any attempt to pay the
balance sale consideration. On the contrary he has taken
false pleas which are not substantiated by any evidence.
Therefore, the finding recorded by the trial Court that the
plaintiff has established his readiness and willingness is not
based on any legal evidence and as such it is vitiated and
requires to be set aside and accordingly it is set aside.
91
POINT No. 3
61. Section 19 of the Specific Relief Act is pressed
into service by the plaintiff to bind defendants 3 and 4 and
to compel them to execute the sale deed in their favour.
Defendants 3 and 4 have taken a specific contention that
they are bona fide purchasers for valuable consideration
without notice of this agreement of sale and therefore they
are not bound by the said contract and no decree for specific
performance can be passed against them.
62. Section 19 of the Specific Relief Act, 1963 reads
as under:-
"19. Relief against parties and persons claiming
under them by subsequent title.- Except as
otherwise provided by this Chapter, specific
performance of a contract may be enforced
against -
(a) either party thereto;
92
(b) any other person claiming under him
by a title arising subsequently to the
contract, except a transferee for
value who has paid his money in
good faith and without notice of the
original contract;
(c) any person claiming under a title
which, though prior to the contract
and known to the plaintiff, might
have been displaced by the
defendant;
(d) when a company has entered into a
contract and subsequently becomes
amalgamated with another company,
the new company which arises out of
the amalgamation;
(e) when the promoters of a company
have, before its incorporation,
entered into a contract for the
purpose of the company and such
contract is warranted by the terms of
the incorporation, the company:
93
Provided that the company has
accepted the contract and communicated
such acceptance to the other party to the
contract.
63. The section lays down a general rule that the
original contract may be specifically enforced against persons
who are not parties to the original contract. It provides the
categories of persons against whom specific performance of a
contract may be enforced. Among them is included, under
clause (b), any transferee claiming under the vendor by a title
arising subsequently to the contract of which, specific
performance is sought. However, a transferee for value, who
has paid his money in good faith and without notice of the
original contract, is excluded from the purview of the said
clause. It is clearly for the transferee to establish the
circumstances which will allow him to retain the benefit of a
transfer which, prima facie, he had no right to get. Further,
the subsequent transferee is the person within whose
knowledge the facts as to whether he has paid and whether
94
he had notice of the original contract lie, and the provisions
of Sections 103 and 106 of the Indian Evidence Act, 1872,
have a bearing on the question. The plaintiff does not
necessarily have knowledge of either matter. To fall within the
excluded class, a transferee must show that:
(a) he has purchased for value the property (which is
the subject-matter of the suit for specific
performance of the contract);
(b) he has paid his money to the vendor in good
faith; and
(c) he had no notice of the earlier contract for sale
(specific performance of which is sought to be
enforced against him).
A bona fide purchaser for valuable consideration who obtains
a legal estate at the time of his purchase without notice of a
prior equitable right is entitled to priority in equity as well as
at law.
95
64. Under Section 19(b) a specific performance of a
contract can be enforced not only against either party thereto,
but against any other person claiming under him by a title
arising subsequently to the contract, except a transferee for
value who has paid his money in good faith and without
notice of original contract. Further, Section 91 of the Indian
Trusts Act, 1882 lays down that where a person acquires
property with notice that another person has entered into an
existing contract affecting that property, of which a specific
performance could be enforced, the former must hold the
property for the benefit of the latter to the extent necessary to
give effect to the contract. An agreement to sell immovable
property does not create any interest in the said property
unless a sale deed is executed conveying the said property.
The vendor, who has not transferred his interest in the
property, though he entered into an agreement with another
to sell the same, can certainly confer title on a third party by
executing a sale deed in his favour. As between the vendor
and the subsequent purchaser, there can be little doubt that
96
there is a transfer of ownership and, therefore, the title to the
property vests in the latter. But the title of the subsequent
purchaser with notice of the prior agreement in favour of
another is subject to the obligation under S. 91, Trusts Act.
He holds the property for the benefit of the latter to the extent
necessary to give effect to the contract. The person in whose
favour there was a prior agreement can specifically enforce
his agreement under Section 27(2) Section 27(b)), Specific
Relief Act, and compel him to execute a sale deed in his
favour. But till such a sale deed is executed by the
subsequent purchaser, the person in whose favour there was
a prior agreement cannot acquire any title to the same. It is
well settled that the initial burden to show that the
subsequent purchaser of suit property covered by earlier suit
agreement was a bona fide purchaser for value without notice
of the suit agreement squarely rests on the shoulders of such
subsequent transferee. Once evidence is led by both the sides
the question of initial onus of proof pales into insignificance
and the Court will have to decide the question in controversy
97
in the light of the evidence on record. Where a transferee has
knowledge of such facts which would put him on inquiry
which if prosecuted would have disclosed a previous
agreement, such transferee is not a transferee without notice
of the original contract. It is the bounden duty of the
purchaser to make all such necessary enquiries and to
ascertain all the facts relating to the property to be purchased
prior to committing in any manner and hence they cannot
simply come forward to put up the general plea that they are
the bonafide purchasers for value and without notice.
Explanation II appended to the interpretation clause in
section 3 of the Transfer of Property Act says: “Any
person acquiring any immovable property or any share or
interest in any such property shall be deemed to have notice
of the title, if any, of any person who is for the time being in
actual possession thereof.
65. Thus, it is seen that a statutory presumption of
“notice” arises against any person who acquires any
98
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. Where there is a tenant in possession
under a lease or an agreement, a person, purchasing part of
the estate, must be bound to inquire, on what terms that
person is in possession.
66. Section 3 of the Transfer of Property Act is the
interpretation clause. It defines when a person is said to
have notice. It reads as under:-
“3. Interpretation- clause.- In this Act,
unless there is something repugnant in the
subject or context,--"
xxx xxx xxx
“a person is said to have notice" of a fact
when he actually knows that fact, or when, but
for willful abstention from an inquiry or search
which he ought to have made, or gross
negligence, he would have known it.
99
Explanation I.- Where any transaction
relating to immoveable property is required by
law to be and has been effected by a registered
instrument, any person acquiring such property or
any part of, or share or interest in, such property
shall be deemed to have notice of such instrument
as from the date of registration or, where the
property is not all situated in one sub- district, or
where the registered instrument has been
registered under sub- section (2) of section 30 of
the Indian Registration Act, 1908 (16 of 1908),
from the earliest date on which any memorandum
of such registered instrument has been filed by
any Sub- Registrar within whose sub- district any
part of the property which is being acquired, or of
the property wherein a share or interest is being
acquired, is situated:
Provided that—
(1) the instrument has been registered and
its registration completed in the manner
prescribed by the Indian Registration Act, 1908
(16 of 1908), and the rules made thereunder,
100
(2) the instrument or memorandum has
been duly entered or filed, as the case may be, in
books kept under section 51 of that Act, and
(3) the particulars regarding the transaction
to which the instrument relates have been
correctly entered in the indexes kept under
section 55 of that Act.
Explanation II.- Any person acquiring any
immoveable property or any share or interest in
any such property shall be deemed to have notice
of the title, if any, of any person who is for the
time being in actual possession thereof.
Explanation III.- A person shall be deemed
to have had notice of any fact if his agent
acquires notice thereof whilst acting on his behalf
in the course of business to which that fact is
material:
Provided that, if the agent fraudulently
conceals the fact, the principal shall not be
charged with notice thereof as against any
person who was a party to or otherwise cognizant
of the fraud.”
101
67. Thus, it is seen that 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 any person who is for the time being in actual
possession thereof. Notice is defined in Section 3 of the
Transfer of Property Act. It may be actual where the party
has actual knowledge of the fact or constructive. A person is
said to have notice of a fact when he actually knows that
fact, or when, but for willful abstention from an inquiry or
search which he ought to have made, or gross negligence, he
would have known it. From the definition of the expression,
a person is said to have notice in Section 3 of the Transfer of
Property Act, it is plain that the word notice is of wider
import than the word knowledge. A person may not have
actual knowledge of a fact but he may have notice of it
having regard to the aforementioned definition and
Explanation II thereto. If the purchasers have relied upon
the assertion of the vendor or on their own knowledge and
abstained from making enquiry into the real nature of the
102
possession of the tenant, they cannot escape from the
consequences of the deemed notice under Explanation II to
Section 3 of the Transfer of Property Act.
68. Section 3 was amended by the Amendment Act
of 1929 in relation to the definition of 'notice'. The definition
has been amended and supplemented by three explanations,
which settle the law in several matters of great importance.
Explanation-II states that actual possession is notice of the
title of the person in possession. Prior to the amendment
there had been some uncertainty because of divergent views
expressed by various High Courts in relation to the actual
possession as notice of title. A person may enter the property
in one capacity and having a kind of interest, but
subsequently while continuing in possession of the property
his capacity or interest may change. A person entering the
property as a tenant later may become a usufructuary
mortgagee or may be an agreement holder to purchase the
same property or may be some other interest is created in
103
his favour subsequently. Hence with reference to subsequent
purchaser, it is essential that he should make an inquiry as
to title or interest of the person in actual possession as on
the date when sale transaction was made in his favour. The
actual possession of a person itself is deemed or constructive
notice of the title if any, of a person who is for the time being
in actual possession thereof. A subsequent purchaser has to
make inquiry as to further interest, nature of possession and
title under which the person was continuing in possession
on the date of purchase of the property. When a person
purchases a property from the owner knowing that it is in
the possession of another, he is under a duty to inquire into
the nature of that possession, and, in the absence of such
inquiry or knowledge of title under which possession is held,
the same should be attributed to the purchaser. Where there
is a tenant in possession under a lease and an agreement of
sale in his favour, a person purchasing part of the estate
must be bound to inquire on what terms that person is in
possession. A tenant being in possession under a lease, with
104
an agreement in his pocket to become the purchaser, those
circumstances altogether give him an equity repelling the
claim of a subsequent purchaser who made no inquiry as to
the nature of his possession. It is the duty of the subsequent
purchaser to inquire from the persons in possession as to
the precise character in which they were in possession at the
time when subsequent sale transaction was entered into. If
there be a tenant in possession of land a purchaser is bound
by all the equities which the tenant could enforce against the
vendor and such equity extends not only to the interest
connected with the tenancy, but also to interests under the
actual agreement.
69. The law on the point is well settled. The principle
of constructive notice of any title which a tenant in actual
possession may have, was laid down by LORD ELDON IN
DANIELS VS. DAVISON [(1809) 16 VES. 249 AT P.254].
The learned law Lord observed:
105
"Where there is a tenant in possession under a
lease, or an agreement, a person purchasing part
of the estate must be bound to inquire on what
terms that person is in possession..........that a
tenant being in possession under a lease, with an
agreement in his pocket to become the purchaser,
those circumstances altogether give him an equity
repelling the claim of a subsequent purchaser
who made no inquiry as to the nature of his
possession"."
(emphasis supplied)
70. In the case of BHUP NARAIN SINGH vs GOKUL
CHAND MAHTON AND OTHERS [AIR 1934 PRIVY COUNCIL
68] it is held as under:-
“In their Lordships' opinion, the section lays
down a general rule that the original contract
may be specifically enforced against a
subsequent transferee, but allows an exception to
that general rule, not to the transferor, but to the
transferee, and, in their Lordships' opinion, it is
clearly for the transferee to establish the
circumstances which will allow him to retain the
benefit of a transfer which, prima facie, he had no
106
right to get. Further, the subsequent transferee is
the person within whose knowledge the facts as
to whether he has paid and whether he had
notice of the original contract lie, and the
provisions of Sections 103 and 106 of the Indian
Evidence Act, 1872, have a bearing on the
question. The plaintiff does not necessarily have
knowledge of either matter……”
71. The High Court of Andhra Pradesh in the case of
MUMMIDI REDDI PAPANNAGARI YELLA REDDY VS. SALLA
SUBBI REDDY AND OTHERS, AIR 1954 AP 20 referring to
various decisions in paragraph 8 has stated thus:
"It may be mentioned here that an
Explanation was introduced into the Transfer of
Property Act by the Amending Act 21 of 1929.
Even prior to this amendment, the law, as
declared in decided cases, was that, when a
person purchased property from the owner
knowing that it is in the possession of another, he
is under a duty to inquire into the nature of that
possession, and, in the absence of such inquiry,
107
knowledge of title under which possession is
held, should be attributed to the purchaser. The
leading case on the subject, relied on in a number
of Indian decisions.
72. A Division Bench of the High Court of Madras in
VEERAMALAI VANNIAR vs. THADIKARA VANNIAR (AIR
1968 MAD. 383) has held as under:-
“that it is also the duty of the subsequent
purchaser to inquire from the persons in
possession as to the precise character in which
he was in possession at the time when
subsequent sale transaction was entered into. If
there be a tenant in possession of land a
purchaser is bound by all the equities which the
tenant could enforce against the vendor and such
equity extends not only to the interest connected
with the tenancy but also to interests under the
actual agreement”.
73. The Apex Court in the case of GOVINDDAS (DR.)
VS. SHANTIBAI (1973) 3 SCC 418 has held as under:-
108
"14. It will be noticed that the evidence is
contradictory and we have to decide whose
version is more acceptable. The learned counsel
for the appellants contended that the onus of
proof was very light on the appellants and they
had discharged it by entering the witness-box
and stating that they had no knowledge. We are
unable to agree with him that in the
circumstances of this case the onus was light on
the appellants. The circumstances that tell
heavily against the version of the appellants are
these. First, all the parties are residents or have
shops in the same vicinity and in places like this
it is not probable that the appellants would not
come to know of the execution of the agreement
(Souda- Chitthi) of the plaintiff. Secondly, the
haste with which the sale-deed in favour of the
appellants was executed was unusual. It is more
usual for an agreement to be executed in such
cases rather than arrive at an oral agreement on
one day and have the sale-deed executed the
next day and registered the following day. For
some reason the appellants were in a hurry to get
the deed registered. What was the reason? In
view of all the circumstances we are inclined to
109
accept the evidence of Hem Raj Chauhan, and
corroborated by Hayat, that Goverdhandas knew
of the execution of the agreement with the
plaintiff on March 1, 1960."
74. The Bombay High Court in the case of
MURLIDHAR BAPUJI VALVE vs YALLAPPA LALU
CHAUGULE AND OTHERS (AIR 1994 BOMBAY 358) has
held as under:-
“20……It is well settled law that the onus
to prove the exception carved out in S.19(b) of the
Specific Relief Act, 1963 is on the subsequent
purchaser. S.19 of the Act clearly provides that
specific performance of a contract may be
enforced against either party thereto or any other
person claiming under him by a title arising
subsequently to the contract, except a transferee
for value who has paid his money in good faith
and without notice of the original contract.”
75. The Supreme Court in the case of
R.K. MOHAMMED UBAIDULLAH AND OTHERS vs HAJEE C
110
ABDUL WAHAB (D) BY LRS AND OTHERS [(2000) 6 SCC
402] has held as under:-
“As can be seen from Section 19 (a) and (b)
extracted above specific performance of a contract
can be enforced against (a) either party thereto
and (b) any person claiming under him by a title
arising subsequent to the contract, except a
transferee for value who has paid his money in
good faith and without notice of the original
contract. Section 19(b) protects the bona fide
purchaser in good faith for value without notice of
the original contract. This protection is in the
nature of exception to the general rule. Hence the
onus of proof of good faith is on the purchaser
who takes the plea that he is an innocent
purchaser. Good faith is a question of fact to be
considered and decided on the facts of each case.
Section 52 of the Penal Code emphasizes due
care and attention in relation to the good faith. In
the General Clauses Act emphasis is laid on
honesty.
15. Notice is defined in Section 3 of the
Transfer of Property Act. It may be actual where
111
the party has actual knowledge of the fact or
constructive. "A person is said to have notice" of a
fact when he actually knows that fact, or when,
but for willful abstention from an inquiry or
search which he ought to have made, or gross
negligence, he would have known it. Explanation
II of said Section 3 reads:
"Explanation II - Any person acquiring any
immoveable property or any share or interest in
any such property shall be deemed to have notice
of the title, if any, of any person who is for the
time being in actual possession thereof."
Section 3 was amended by the Amendment Act of
1929 in relation to the definition of 'notice'. The
definition has been amended and supplemented
by three explanations, which settle the law in
several matters of great importance. For the
immediate purpose Explanation-II is relevant. It
states that actual possession is notice of the title
of the person in possession. Prior to the
amendment there had been some uncertainty
because of divergent views expressed by various
High Courts in relation to the actual possession
as notice of title. A person may enter the property
112
in one capacity and having a kind of interest. But
subsequently while continuing in possession of
the property his capacity or interest may change.
A person entering the property as tenant later
may become usufructuary mortgagee or may be
agreement holder to purchase the same property
or may be some other interest is created in his
favour subsequently. Hence with reference to
subsequent purchaser it is essential that he
should make an inquiry as to title or interest of
the person in actual possession as on the date
when sale transaction was made in his favour.
The actual possession of a person itself is
deemed or constructive notice of the title if any, of
a person who is for the time being in actual
possession thereof. A subsequent purchaser has
to make inquiry as to further interest, nature of
possession and title under which the person was
continuing in possession on the date of purchase
of the property. In the case on hand defendants 2
to 4 contended that they were already aware of
the nature of possession of the plaintiff over the
suit property as a tenant and as such there was
no need to make any inquiry. At one stage they
also contended that they purchased the property
113
after contacting the plaintiff, of course, which
contention was negatived by the learned trial
court as well as the High court. Even otherwise
the said contention is self- contradictory. In view
of Section 19(b) of the Specific Relief Act and
definition of 'notice' given in Section 3 of the
Transfer of Property Act read along with
explanation II, it is rightly held by the trial court
as well as by the High Court that the defendants
2 to 5 were not bona fide purchasers in good faith
for value without notice of the original contract.
76. The Apex Court in the case of RAM NIWAS
(DEAD) THROUGH LRS vs BANO (SMT) AND OTHERS
[(2000) 6 SCC 685] has held as under:-
(a) “3. Section 19 provides the categories of
persons against whom specific performance
of a contract may be enforced. Among them
is included, under clause (b), any
transferee claiming under the vendor by a
title arising subsequently to the contract of
which, specific performance is sought.
However, a transferee for value, who has
114
paid his money in good faith and without
notice of the original contract, is excluded
from the purview of the said clause.
4. The said provision is based on the principle
of English law which fixes priority between
a legal right and an equitable right. If ‘A’
purchases any property from ‘B’ and
thereafter ‘B’ sells the same to ‘C’, the sale
in favour of ‘A’, being prior in time, prevails
over the sale in favour of ‘C’ as both ‘A’
and ‘C’ acquired legal rights. But where
one is a legal right and the other is an
equitable right
“a bona fide purchaser for valuable
consideration who obtains a legal estate at
the time of his purchase without notice of a
prior equitable right is entitled to priority in
equity as well as at law.” [Snells Equity –
13th Edn p.48].
7. Thus, it is seen that a statutory
presumption of “notice” arises against any
person who acquires any immovable
property or any share or interest therein of
115
the title, if any, of the person who is for the
time being in actual possession thereof.
77. The Supreme Court in the case of VASANTHA
VISWANATHAN AND OTHERS vs V.K.ELAYALWAR AND
OTHERS [(2001) 8 SCC 133] has held as under:-
“13…… Section 19(b) of the Specific Relief
Act, 1877 (sic 1963), which occurs in Chapter II,
applies to movables by virtue of the provisions of
Section 58 of the Sale of Goods Act referred to
above. Under Section 19(b) a specific performance
of a contract can be enforced not only against
either party thereto but against any other person
claiming under him by a title arising subsequently
to the contract, except a transferee for value who
has paid his money in good faith and without
notice of original contract. Further, Section 91 of
the Indian Trusts Act, 1882 lays down that where
a person acquires property with notice that
another person has entered into an existing
contract affecting that property, of which a
specific performance could be enforced, the former
must hold the property for the benefit of the latter
116
to the extent necessary to give effect to the
contract……”
78. In the instant case, the plaintiff contends that,
when the execution of the agreement of sale is not in dispute
and the agreement of sale specifically contains a recital that
the possession of the property is handed over to him on the
day of the agreement of sale, the fact that he is in possession
is established. Therefore, in so far as defendant No.2 is
concerned, she admits that she was aware of the existence of
such an agreement and that she purchased the property
because the said agreement had been cancelled. Therefore,
she actually knows the fact that plaintiff was in possession
of the property on the day she purchased the property. In so
far as defendants 2 to 4 are concerned, they were also aware
of the existence of the agreement of sale and therefore they
were also knowing the fact that the plaintiff is in possession.
Even otherwise, they did not make any enquiry which they
ought to have made and therefore because of their gross
negligence they are deemed to have had notice of the
117
possession of the plaintiff over the schedule property.
Therefore, they cannot plead that they purchased the
property without notice of the said agreement of sale.
79. It is true that in the agreement of sale there is a
recital that the plaintiff was put in possession of the
agreement of sale. The question is, on the day the
defendants’ purchased the property, was he in possession of
the property. The entire argument is based on the footing
that the plaintiff has taken possession of the property in part
performance of the agreement of sale and therefore Section
53A of the Transfer of the Property Act is attracted.
SECTION 53A OF THE TRANSFER OF PROPERTY ACT
80. Therefore, the question that arise for
consideration is, whether the plaintiff is entitled to the
benefit of Section 53A of the Transfer of Property Act.
Section 53A of the Transfer of Property Act reads as under : -
118
“53A. Part performance.- Where any
person contracts to transfer for consideration any
immoveable property by writing signed by him or
on his behalf from which the terms necessary to
constitute the transfer can be ascertained with
reasonable certainty,
and the transferee has, in part
performance of the contract, taken possession
of the property or any part thereof, or the
transferee, being already in possession,
continues in possession in part performance
of the contract and has done some act in
furtherance of the contract,
and the transferee has performed or is
willing to perform his part of the contract,
then, notwithstanding that where there is
an instrument of transfer, that the transfer has
not been completed in the manner prescribed
therefor by the law for the time being in force, the
transferor or any person claiming under him shall
be debarred from enforcing against the transferee
and persons claiming under him any right in
respect of the property of which the transferee
119
has taken or continued in possession, other than
a right expressly provided by the terms of the
contract.
Provided that nothing in this section shall
affect the rights of a transferee for consideration
who has no notice of the contract or of the part
performance thereof”.
81. This provision has been the subject matter of
interpretation by the Supreme Court. The Supreme Court in
the case of BAI DOSABAI vs MATHURDAS GOVINDDAS
AND OTHERS [AIR 1980 SC 1334] has held as under:-
“6. …… The concept and creation of duality
of ownership, legal and equitable, on the
execution of an agreement to convey immovable
property, as understood in England is alien to
Indian Law which recognises one owner i.e. the
legal owner……...The ultimate paragraph of
Section 54 of the Transfer of Property Act,
expressly enunciates that a contract for the sale
of immovable property does not, of itself, create
any interest in or charge on such property. But
120
the ultimate and penultimate paragraphs of
Section 40 of the Transfer of Property Act make it
clear that such a contract creates an obligation
annexed to the ownership of immovable property,
not amounting to an interest in the property, but
which obligation may be enforced against a
transferee with notice or the contract or a
gratuitous transferee of the property. Thus the
Equitable ownership in property recognised by
Equity in England is translated into Indian law as
an obligation annexed to the ownership of
property, not amounting to an interest in the
property, but an obligation which may be
enforced against a transferee with notice or a
gratuitous transferee.
7. If we now turn to the Indian Trusts Act, we
find "trust" defined as:
"an obligation annexed to the ownership of
property, and arising out of a confidence reposed
in and accepted by the owner, or declared and
accepted by him, for the benefit of another, or of
another and the owner",
121
and "beneficial interest" defined as the interest of
the beneficiary against the trustee as owner of
the trust- property. Chapter IX of the Trusts Act
enumerates in section after section cases where
obligations in the nature of trust are created.
Section 94 finally provides:
"94. In any case not coming within the
scope of any of the preceding sections, where
there is no trust, but the person having
possession of property has not the whole
beneficial interest therein, he must hold the
property for the benefit of the persons having
such interest, or the residue thereof (as the case
may be), to the extent necessary to satisfy their
just demands".
8. We may now examine some of the
provisions of the Specific Relief Act, 1877, which
though repealed and replaced by Act 47 of 1963.
is the statute with which we are concerned.
"Trust" was defined in Section 3 of the 1877 Act
as having "the same meaning as in Section 3 of
the Indian Trusts Act" and as "including an
obligation in the nature of a trust within the
122
meaning of Chapter IX of that Act". Section 12(a)
of the Act of 1877 provided, "Except as otherwise
provided in this Act, specific performance of
contract may, in the discretion of the Court, be
enforced when the act agreed to be done is in the
performance wholly or partly of a trust". The other
clauses of Section 12 and Sections 13 to 18
enumerated the other contracts which might be
specifically enforced. Section 21 specified when
contracts were not specifically enforceable.
Section 16 is of some relevance. It said:
"when part of a contract which, taken by itself
can and ought to be specifically performed,
stands on a separate and independent footing
from another part of the same contract which
cannot or ought not to be specifically performed,
the Court may direct specific performance of the
former part".
82. The Kerala High Court in the case of M/s
JACOBS PRIVATE LIMITED vs THOMAS JACOB [AIR 1995
KERALA 249] has held as under:-
123
“9 ……. The following postulates are sine
qua non for basing a claim on Sec.53-A (1). The
contract should have been in writing signed by
the transferor, (2) The transferee should have got
possession of the immovable property covered by
the contract. (3) The transferee should have done
some act in furtherance of the contract. (4) The
transferee has either performed his part of the
contract or is willing to perform his part of the
contract. Section 53-A makes it clear by
employing the word "then" after laying down the
pre-requisites that a transferee can seek refuge
under it only after satisfying the above pre-
requisites. In other words, the bar envisaged in
the section against enforcement of the transferor's
right can be exercised only on compliance with
the postulates. The said bar is intended to be
used by a transferee only as a shield and not as
a sword.
11. Willingness to perform the roles
ascribed to a party in a contract is primarily a
mental disposition. However, such willingness in
the context of Sec.53-A of the T. P. Act must be
absolute and unconditional. If willingness is
124
studded with a condition, it is in fact no more
than an offer and cannot be termed as
willingness. As a right is created by the statute in
favour of a transferee through Sec.53-A, the
transferee has to fulfil all the conditions for
acquiring the right. In other words, what is
contemplated is the complete performance or
complete willingness and not performance in part
or conditional willingness or even willingness in
part……”
83. The Supreme Court in the case of SHRIMANT
SHAMRAO SURYAVANSHI AND ANOTHER Vs PRALHAD
BHAIROBA SURYAVANSHI (DEAD) BY LRs AND OTHERS
[ILR 2003 KAR 503] has held as under:-
“7. A perusal of Section 53-A shows that it
does not forbid a defendant transferee from
taking a plea in his defence to protect his
possession over the suit property obtained in part
performance of a contract even though the period
of limitation for bringing a suit for specific
performance has expired. It also does not
expressly provide that a defendant transferee is
125
not entitled to protect his possession over the suit
property taken in part performance of the contract
if the period of limitation to bring a suit for
specific performance has expired. In absence of
such a provision, we have to interpret the
provisions of Section 53-A in a scientific manner.
It means to look into the legislative history and
structure of the provisions of Section 53- A of the
Act.
8. Earlier, the assistance of historical facts or
any document preceding the legislation was very
much frowned upon for purposes of construction
of statutes. At that time, there was some
injunction against applying principle of looking
into the historical facts or reports preceding the
legislation in construing a statute. However, by
passage of time, this embargo has been lifted.
9. In R.S. Nayak vs. A.R. Antulay - 1984 (2)
SCC 183, it was held thus :
"(R)eports of the Committee which preceded
the enactment of a legislation reports of
Joint Parliament Committee report of a
126
commission set up for collecting information
leading to the enactment are permissible
external aid to construction. If the basic
purpose underlying construction of
legislation is to ascertain the real intention
of the Parliament why should the aids
which Parliament availed of such as report
of a Special Committee preceding the
enactment existing State of Law, the
environment necessitating enactment of
legislation and the object sought to be
achieved be denied to Court whose function
is primarily to give effect to the real
intention of the Parliament in enactment of
the legislation. Such denial would deprive
the Court of a substantial and illuminating
aid to constructions. (SCC pp. 214-15
para 34)
The modern approach has to a
considerable extent eroded the
exclusionary rule even in England. (SCC p.
212. Para 33)”
127
The modern approach has to a
considerable extent eroded the
exclusionary rule even in England (SCC
p.212 para 33).
10. Now the accepted view is that the
document or report preceding the legislation can
legitimately be taken into consideration while
construing the provisions of an Act.
11. We, therefore, proceed to examine the
question before us in the light of facts stated
hereinafter.
12. In England, the provisions of the law of
Property Act of the Statute of Fraud provided that
no suit or action would be brought on agreement
relating to a property which was not in writing
signed by the parties. The aim and object of the
statute was to protect a party against fraud.
However, certain difficulties were experienced
when it was found that under an oral agreement
a party has performed his part of the contract, yet
he was unable to bring any action or suit against
other party viz., transferor for a specific
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performance of the agreement which was not in
writing in view of the provisions contained in the
Statute of Fraud. Under such situations,
transferors managed to play fraud on innocent
buyers who entered into an oral agreement and
performed their part of the contract. In view of
such prevailing circumstances in England, the
Court of Equity intervened on the ground of equity
and took action to enforce specific performance of
a parole agreement. The view taken by the Court
of Equity was that the object behind the Law of
Property of the Statute of Fraud was to protect
against a fraud, but the provisions of Law of
Property of Statute of Fraud were being used as
an instrument to help and protect fraud. Thus, the
Court of Equity did not permit the Statute of
Fraud to be used as an instrument to cover the
fraud by the transferors where there was a part
performance of a parole agreement.
13. When the Transfer of Property Act was
enacted, Section 53-A did not find place in it. In
the absence of Section 53-A, there arose
difference of opinion between various courts in
India as regards the application of English
129
doctrine of part performance of contract as it was
then prevailing in England. Since there was a
difference of opinion on question of the
application of English equitable doctrine of part
performance in various courts of India, the Govt.
of India resolved to set up a Special Committee for
making recommendations amongst others
whether the British equitable doctrine of part
performance be extended in India also. The
Special Committee was of the view that an
illiterate or ignorant buyer who had partly
performed his part of contract required statutory
protection. The Committee was of the further view
that where a transferee in good faith that lawful
instrument i.e. a written contract would be
executed by the transferor takes possession over
the property, the equity demanded that the
transferee should not be treated as trespasser by
the transferor and subsequently evict him through
process of law in the absence of lawful transfer
instrument. The Special Committee also
considered the question whether protection under
the proposed Section 53-A to a transferee would
also be available even if the period of limitation
for bringing an action for specific performance of
130
an agreement to sell has expired. On the said
question, the Committee was of the view that
even after expiry of period of limitation, the
relationship between the transferor and
transferee remains the same as it was within the
period of limitation and, therefore, the possession
over the property taken in part performance of an
agreement is required to be protected even if the
period of limitation for bringing an action for
specific performance has expired.
14. The aforesaid recommendation of the
Special Committee were accepted by the Govt. of
India as the same is well reflected in the aims
and objects of amending Act 1929 whereby
Section 53-A was inserted in the Act.
15. The Special Committee's report which is
reflected in the aims and objects of amending Act
1929 shows that one of the purposes of enacting
Section 53-A was to provide protection to a
transferee who in part performance of the
contract had taken possession of the property
even if the limitation to bring a suit for specific
performance has expired. In that view of the
131
matter, Section 53-A is required to be interpreted
in the light of the recommendation of Special
Committee's report and aims, objects contained in
amending Act 1929 of the Act and specially when
Section 53-A itself does not put any restriction to
plea taken in defence by a transferee to protect
his possession under Section 53-A even if the
period of limitation to bring a suit for specific
performance has expired.
16. But there are certain conditions which are
required to be fulfilled if a transferee wants to
defend or protect his possession under Section
53-A of the Act. The necessary conditions are
1) there must be a contract to transfer for
consideration any immovable property;
2) the contract must be in writing, signed
by the transferor, or by someone on his
behalf;
3) the writing must be in such words from
which the terms necessary to construe the
transfer can be ascertained;
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4) the transferee must in part performance
of the contract take possession of the
property, or of any part thereof;
5) the transferee must have done some act
in furtherance of the contract; and
6) the transferee must have performed or
be willing to perform his part of the
contract.
17. We are, therefore, of the opinion that if the
conditions enumerated above are complied with,
the law of limitation does not come in the way of
a defendant taking plea under Section 53-A of the
Act to protect his possession of the suit property
even though a suit for specific performance of a
contract has barred by limitation.
18. The matter may be examined from another
angle. The established rule of limitation is that
law of limitation is not applicable to a plea taken
in defence unless expressly a provision is made
in the statute. The law of limitation applies to the
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suits and applications. The various articles of the
Limitation Act show that they do not apply to a
defence taken by a defendant in a suit. Thus, the
law of limitation bars only an action in a court of
law. In fact, what the Limitation Act does is, to
take away the remedy of a plaintiff to enforce his
rights by bringing an action in a court of law, but
it does not place any restriction to a defendant to
put forward any defence though such defence as
a claim made by him may be barred by limitation
and cannot be enforced in a court of law. On the
said principle, a defendant in a suit can put
forward any defence though such defence may
not be enforceable in a court of law, being barred
by limitation.
19. In M.K. Venkatachari & Ors. vs. I.A.R.
Arunachalam Pillai & Ors. AIR 1967 Madras,
410, it was held, thus:
"That defence to limitation is a creature of a
positive law and, therefore, cannot be
extended to cases which do not strictly fall
within the enactment. It is an established
canon of construction of law of limitation
134
not to enlarge the scope of statutory
provisions of limitation by analogy or logic".
20. It is, therefore, manifest that the Limitation
Act does not extinguish a defence, but only bars
the remedy. Since the period of limitation bars a
suit for specific performance of a contract, if
brought after the period of limitation, it is open to
a defendant in a suit for recovery of possession
brought by a transferor to take a plea in defence
of part performance of the contract to protect his
possession, though he may not able to enforce
that right through a suit or action.
84. The Supreme Court in the case of FGP LIMITED
vs SALEH HOOSEINI DOCTOR AND ANOTHER [(2009) 10
SCC 223] has held as under:-
“23. The submission by the appellant's
counsel on part performance of the contract under
Section 53-A of the Transfer of Property Act also
cannot be accepted. Section 53-A of the Transfer
of Property Act is based upon the equitable
doctrine of part performance in English Law.
135
Initially Section 53-A was not incorporated in the
Transfer of Property Act but the same came by
way of an amendment for the first time by the
Transfer of Property Amendment Act 1929 (Act of
1929). The amendment had to be made in view of
some divergence in judicial opinion on the
application of the aforesaid equitable doctrine by
various Courts in India.
24. Section 53-A of the Transfer of Property Act
has certain ingredients and, in our judgment,
those are:-
(1) a contract to transfer immovable
property;
(2) the transfer should be for
consideration;
(3) the contract must be in writing; (4) it
should be signed by or on behalf of
the transferor;
(5) the terms of the contract can be
ascertained with reasonable
certainty from the writing;
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(6) the transferee takes possession of
the whole or part of the property or if
already in possession continues in
possession;
(7) such taking of or continuance in
possession should be in part
performance of the contract;
(8) the transferee should do some act in
furtherance of the contract; and
(9) he should have performed, or be
willing to perform, his part of the
contract.
25. The rationale of the equitable doctrine of
part performance in English Law has been traced
in Section 53-A by this Court in the case of Sardar
Govindrao Mahadik Vs. Devi Sahai [1982(1) SCC
237]. In para 13, page 249 of the report while
tracing the said equitable doctrine in the way it
has been assimilated in Section 53-A of the
Transfer of Property Act, the learned Judges held
that the act or action relied upon as “evidencing
part performance”; must be of such nature and
137
character that its existence would establish the
contract and its implementation. The learned
Judges further held that the crucial act or action
must be of such a character as to be
unequivocally referable to the contract as having
been performed in performance of the contract.
26. In support of the said conclusion, the
learned Judges referred to an Old English
decision rendered in the case of (Lady) V. Earl of
Glengall (2 HL Cases 131). In referring to the
said case, the learned Judges quoted the
observations therefrom and which are reproduced
herein below: (Thynne case, HL. p.158)
“...part performance to take the case out of
the Statute of Frauds, always supposes a
completed agreement. There can be no part
performance where there is no completed
agreement in existence. It must be
obligatory, and what is done must be under
the terms of the agreement and by force of
the agreement...”
Relying on the aforesaid principle, the learned
Judges in Sardar Govindrao Mahadik (supra)
138
reiterated that the act relied upon by the party
invoking the said doctrine must be such as by its
own force to show the very existence of the same
contract.”
85. From the aforesaid judgments of the Apex Court
it is clear that, the ultimate paragraph of Section 54 of the
Transfer of Property Act, expressly enunciates that a
contract for the sale of immovable property does not, of itself,
create any interest in or charge on such property. But the
ultimate and penultimate paragraphs of Section 40 of the
Transfer of Property Act make it clear that such a contract
creates an obligation annexed to the ownership of immovable
property, not amounting to an interest in the property, but
which obligation may be enforced against a transferee with
notice or the contract or a gratuitous transferee of the
property. Thus the Equitable ownership in property
recognised by Equity in England is translated into Indian law
as an obligation annexed to the ownership of property, not
amounting to an interest in the property, but an obligation
139
which may be enforced against a transferee with notice or a
gratuitous transferee. When the Transfer of Property Act was
enacted, Section 53-A did not find place in it. In the absence
of Section 53-A, there arose difference of opinion between
various Courts in India as regards the application of English
doctrine of part performance of contract as it was then
prevailing in England. A Special Committee was constituted
to consider, whether the British equitable doctrine of part
performance was extended in India also. Based on the
recommendation of the Committee by Amending Act 1929,
Section 53A was inserted in the Act. The purpose of
enacting Section 53A was to provide protection to a
transferee who in part performance of the contract had taken
possession of the property even if the limitation to bring a
suit for specific performance has expired. However, there
are certain conditions which are required to be fulfilled if a
transferee wants to defend or protect his possession under
Section 53-A of the Act. The necessary conditions are:
140
1) there must be a contract to transfer for
consideration any immovable property;
2) the contract must be in writing, signed by the
transferor, or by someone on his behalf;
3) the writing must be in such words from which
the terms necessary to construe the transfer can
be ascertained;
4) the transferee must in part performance of the
contract take possession of the property, or of
any part thereof;
5) the transferee must have done some act in
furtherance of the contract; and
6) the transferee must have performed or be willing
to perform his part of the contract.
86. Therefore, it is clear that, before a transferee can
claim the benefit of Section 53A, the contract should have
been in writing signed by the transferor, the transferee
should have got possession of the immovable property
covered by the contract, the transferee should have done
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some act in furtherance of the contract and lastly the
transferee has either performed his part of the contract or is
willing to perform his part of the contract. Section 53-A
makes it clear by employing the word "then" after laying down
the pre-requisites that a transferee can seek refuge under it
only after satisfying the above pre-requisites. In other words,
the bar envisaged in the section against enforcement of the
transferor's right can be exercised only on compliance with
the postulates. Willingness to perform the roles ascribed to a
party in a contract is primarily a mental disposition.
However, such willingness in the context of Sec.53-A of the
Transfer of Property Act must be absolute and unconditional.
If willingness is studded with a condition, it is in fact no more
than an offer and cannot be termed as willingness. Therefore,
the sine qua non for basing a claim on Section 53A is the
complete performance or complete willingness and not
performance in part or conditional willingness or even
willingness in part. It is only when the transferee has either
performed his part of the contract or is willing to perform his
142
part of the contract, he is entitled to the benefit of Section
53A of the Transfer of Property Act.
87. Proviso to Section 53A makes it clear that
nothing in Section 53A shall affect the rights of a transferee
for consideration who has no notice of the contract or of the
part performance thereof. Therefore, Section 53A has no
application in so far as the rights of the transferee for
consideration who had no notice of the contract or of the
part performance thereof. It is in this background that we
have to appreciate the facts of this case.
88. Though the execution of the agreement of sale is
not in dispute, we have already held the agreement of sale is
interpolated in so far as the material terms of the contract
are concerned and therefore, it amounts to cancelling the
agreement of sale. Even otherwise we have said it is
unenforceable in law. Secondly we have recorded a finding
that plaintiff was not ready and willing to perform his part of
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the contract and therefore the agreement is not enforceable.
For application of Section 53A mere acceptance of an
agreement of sale and taking possession of the property
agreed to be sold in part performance of the contract by itself
is not sufficient. The transferee should perform or is willing
to perform his part of the contract. It is only then Section
53A is attracted. In view of our finding that the plaintiff has
neither performed nor willing to perform his part of the
contract, the plaintiff cannot take advantage of Section 53A.
Therefore, it does not confer any right under the agreement
so as to protect his alleged possession. The plaintiff in his
examination in chief at para 7 has categorically stated that
the suit agreement was not cancelled prior to the execution
of the sale deed by the first defendant in favour of
defendants 2 to 4. As the first defendant had taken a
specific contention in para 7 of the written statement that
the agreement is cancelled and in para 8 it was specifically
stated that the said document of cancellation dated
19.8.1992 is produced as Annexure-X to the written
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statement, the plaintiff was deposing that the said
cancellation deed was not executed prior to the execution of
the sale deeds by the first defendant in favour of defendants
2 to 4. Even otherwise, we have recorded a categorical
finding that because of the interpolation of material terms of
the contract, it has the effect of cancelling the agreement and
it is unenforceable.
89. The plaintiff in his evidence speaking about part
performance of the agreement of sale has stated in para 3 of
the deposition that, when he purchased the property the
schedule land was not even and some shrubs were there.
After he took possession he engaged a bulldozer and got the
land levelled so as to make it useful for the purpose of
agriculture. Thereafter, he had planted mango trees. He got
a well dug and also installed a pump set. Further, he got a
barbed wire fencing to the schedule property. He spent
about Rs.8 Lakhs for these developments. This fact is
disputed by the defendants. The plaintiff has not produced
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any scrap of paper to establish this fact of part performance
and therefore we have already recorded a finding that the
case of part performance as pleaded is not established. It
was contended that defendants 3 and 4 have not made any
enquiry at all before purchasing the property and therefore
they cannot contend they had no notice of this agreement of
sale. The evidence of defendant Nos. 2, 3 and 4 do not show
that they have made any enquiries at all. It is in this regard
it is to be noticed defendant DW2 and her husband DW3
were residing at Saudi Arabia whereas defendants 3 and 4
are residents of Bangalore. They did not purchase the
property from the first defendant. They have purchased the
property from the Power of Attorney Holder of the first
defendant. The said Power of Attorney in original is
produced and marked in this case as Ex. D2. The Power of
Attorney Holder Sri Amit Gupta was also examined as DW4.
The first defendant admits the execution of sale deed in
favour of defendants 2 to 4 in para 7 of the written
statement. Her son who was examined as DW1 in the case
146
as her Power of Attorney Holder has deposed at para 4 of the
deposition that, his mother has sold some part of the
property to the third defendant. It has been done without
his knowledge. With the intention of deceiving the plaintiff,
in the year 1992 she has executed a Power of Attorney in
favour of the fourth defendant. That was also done without
his knowledge. The said Power of Attorney is executed on
26.6.1992. Therefore, execution of the Power of Attorney by
the first defendant in favour of Amit Gupta-DW4 and the
execution of the sale deed by Amit Gupta in favour of
defendants 2 to 4 is not in dispute. The said Amit Gupta
has been examined who has deposed that he did not make
enquiry to find out who is in possession of the property
before execution of the Power of Attorney. After execution of
the sale deed in favour of defendants 2 to 4, he has handed
over the money to 1st defendant, who has executed receipts
after receiving the money. The second defendant negotiated
with him to purchase the land. A year earlier her husband
had come to him for negotiations. Then he has seen some
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nilagiri trees and other trees in the land. He did not enquire
with 1st defendant who has planted those trees. He did not
make any enquiry with the 1st defendant to find out whether
she had made any commitments with regard to the suit
property with any persons. She must have executed
agreement with plaintiff and she told that the same was
cancelled. He did not enquire with the plaintiff whether the
said agreement was cancelled. He is doing real estate
business. On the say of the defendant 2 and her husband,
the 1st defendant executed the Power of Attorney in his
favour and prior to the execution of Power of Attorney,
negotiations were completed. He was present on the date of
negotiations between the parties. On that day there was no
token advance taken. He has denied the suggestion that 1st
defendant was not in possession of the suit land on the date
of execution of the sale deed. He has pleaded his ignorance
that plaintiff was put in possession of the property on the
date of the agreement. He denied the suggestion that 1st
defendant did not deliver possession to the defendants.
148
90. We have also the evidence of DW6-the Power of
Attorney Holder of third defendant. He has stated that the
third defendant prior to purchase of the schedule land
through her son fourth defendant made enquiries regarding
title of 1st defendant over the said land. He was present
throughout the negotiations, registration and thereafter. He
is a family friend of the third and fourth defendants. He
assisted them in all these matters. He has deposed that
prior to purchase, they verified the RTC, katha entries and
encumbrance certificates and found that the property stood
in the name of 1st defendant after the death of her husband
Sri Munishami Gowda and that after being convinced about
the title of 1st defendant, the third defendant purchased the
said land for valuable consideration. At all the time when
they negotiated for the purchase of the land and at the time
of purchase, 1st defendant was in possession of the said land
and as such, she delivered possession of the schedule land
to the third defendant. Immediately after the purchase of
the land, the third defendant submitted necessary
149
applications to the revenue authorities and got her name
mutated as kathedar of the said land vide the mutation
register bearing No. 5/93-94. She has been shown as the
person in personal cultivation of the said land in the pahani
register. At no point of time, the name of the plaintiff was
shown in the pahani records. The third defendant planted
mango trees on the said land. The third defendant was not
informed of the alleged agreement of sale, which the first
defendant has entered into with the plaintiff. The third
defendant is totally unaware of the said agreement of sale.
Further, when they made enquiries in the village at the time
of purchase, nobody in the village was aware of any such
agreement of sale. In fact, everyone said that the first
defendant is the owner of the said land and she has valid
title to the said land and therefore, the third defendant
purchased the said land from the first defendant. The third
defendant is in possession of the land in Sy. No. 108
measuring 7 acres 20 guntas.
150
91. In the cross-examination he has stated that, he
made enquiries near the land, village and also with the
Village Accountant. He enquired with one Govindappa, but
he does not remember the other names. He has asserted
that it is he who has planted the mango trees. He is taking
the usufructus from the mango trees. He has also deposed
about the steps he has taken after purchase of the land for
getting the land surveyed and the mutation entries written in
the name of the purchasers.
92. The fourth defendant was also in the witness
box. He deposed that one Muniraju from Kannamangala
Village introduced him to the 1st defendant. He is a broker
and a middle man. They entered into the transactions
through him. He was a local man and he was knowing the
state of affairs at the spot of the suit land. He did not accept
whatever was told by Muniraju. He also visited the spot and
checked the land and also enquired the villagers. He has
gone number of times near the land. When he saw the land
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for the first time, there were nilagiri trees. It may be of 15 to
20 feet height. The trees may be aged about 3 to 4 years.
He does not remember whether the nilagiri trees were cut
and removed in the month of January and February 1991.
He has not enquired with 1st defendant who cut and removed
the nilagiri trees. He asserts that, in his mother's property
they have planted mango trees. Age of mango trees is about
10 to 12 years. He has employed some workers and planted
the mango trees. The mango trees are already yielding
fruits. He has not maintained any accounts regarding the
expenditure incurred.
93. From this evidence it is clear that, it is not as if
that defendants 2 to 4 did not make any enquiries before
purchase of the land. They did make enquiries through their
agents. It is not the law that the purchaser should make
enquiry personally. Explanation II states that, any person
acquiring any immovable property or any share or interest in
any such property shall be deemed to have notice of the title,
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if any, of any person who is for the time being in actual
possession thereof. In other words, for application of
Explanation II, the possession of the property by the plaintiff
is a must. It is only thereafter if no enquiry is made or
search which he ought to have made, is not made, then he is
deemed to have notice. In so far as search is concerned, the
evidence on record shows that plaintiff’s name was not
entered in the RTC. No katha was made out. Agreement
was not registered. The evidence of the defendants clearly
establish that they obtained an encumbrance certificate,
they obtained pahanis, they obtained katha, all of which
showed the name of the first defendant-the vendor. Except
the recital in the agreement of sale that the plaintiff was put
in possession, there is absolutely nothing on record to show
that he was put in possession and more so he continued in
possession. His case of carrying out developmental activities
is held to be not proved. Therefore, on the day the
defendants 3 and 4 purchased the property, there is nothing
on record to show that the plaintiff was in possession of the
153
property. The plaintiff relies on a notice issued to the
defendant No.2 by the revenue authorities calling upon her
to be present at the time of survey where a reference is made
to the effect that the plaintiff is in possession of the property.
Relying on that piece of evidence which is marked as Exs.
P16 and 17 it was contended that it shows the plaintiff’s
possession. The evidence on record shows that the plaintiff
is an adjoining land owner. After purchase, when
applications were filed for mutating the name of the second
defendant, he has raised objections contending that he is in
possession. It is in that context he was able to get that
recital in Exs. P16 and 17, the document which has come
into existence subsequent to the date of sale and subsequent
to the dispute between the parties. That is not a document
which establishes the possession of the plaintiff over the
schedule property. In fact, mutation entries were made in
pursuance of the sale deed in favour of defendants 3 and 4
in respect of the property which they have purchased and
there was no such objection. Ultimately, the mutation
154
entries were made in the name of the second defendant after
enquiry when they found that the claim of the plaintiff is
baseless. Therefore, the evidence on record do not show
plaintiff’s possession over the schedule property on the day
defendants 2 to 4 purchased the property and as such they
cannot be attributed any notice of any title which the
plaintiff possessed over the schedule property. It is here, it
is necessary to mention that a contract for sale of immovable
property is a contract that sale of such property shall take
place on terms settled between the parties and it does not
itself create any interest in or charge of such property.
Therefore, plaintiff acquired no interest under the agreement
of sale. Secondly, the said agreement is interpolated
resulting in its cancellation. Thirdly, in part performance of
the agreement of sale nothing is done. The plaintiff was not
ready and willing to perform his part of the contract and
therefore no right under Section 53A is acquired by the
plaintiff under the agreement. Defendants 3 and 4 have
purchased the property. The sale is not in dispute. Payment
155
of consideration is not in dispute. Now, mutation entries are
made on the basis of the sale deed in their name. The sale
deed recites that possession is delivered to them on the date
of sale. They have been paying taxes. Subsequently, the
plaintiff has amended the plaint seeking the relief of
possession which shows he is not in possession. In the light
of these proved facts on record, the contention that the
plaintiff was in possession of the land from the date of the
agreement of sale, defendants 2 to 4 failed to make
enquiries, therefore they are deemed to have notice of the
plaintiff’s right over the property and they cannot be
construed as bona fide purchasers for valuable consideration
without notice of the agreement of sale is not established. On
the contrary, the defendants have established that they are
bona fide purchasers for valuable consideration and
defendants 3 and 4 have also established that they have no
notice of the agreement of sale.
94. The trial Court was of the view that from the
evidence of DW6 it goes to show that defendant No.3
156
purchased the property without making any proper enquiry
which is mandatory under law. It did not accept the case of
defendants 3 and 4 that they have purchased the portion of
the suit property without the knowledge of the prior
agreement between the first defendant and plaintiff.
According to the trial Court, the document alleged to be got
executed by defendants 2 to 4 appears to be suspicious
nature of document and they have not purchased the
property for valuable consideration can be gathered from
their evidence only. Therefore, the contention that they are
the bona fide purchasers for value without knowledge of the
agreement falls to the ground. It relies on Exs. P16 and 17
notices issued by the survey authorities where it is
mentioned that plaintiff was in possession of the suit land
and defendants 2 to 4 never came in possession of the
purchased lands at any point of time. Defendants 2 to 4
without verifying as to who are in possession of the property
and without making proper enquiry with any of the adjoining
land owner or villagers, they have ventured to purchase the
157
property and they have got executed the sale deeds from the
first defendant. Hence, it cannot be said that they are bona
fide purchasers for value without notice of the prior
agreement.
95. This reasoning runs counter to the evidence on
record. The execution of the sale deeds in favour of
defendants 2 to 4 is not in dispute at all. DW1 has admitted
in his evidence that the said sale deeds came to be executed
without his knowledge. The executant of the sale deed, the
Power of Attorney Holder of the first defendant has been
examined in this case. The sale deeds are all duly registered.
The consideration mentioned clearly go to show that the
properties were sold for valuable consideration. The revenue
authorities acting on these registered sale deeds have made
mutation entries entering the names of the purchasers.
They have been paying taxes. It is because of the objection
of the plaintiff to mutate the name of the second defendant,
proceedings were initiated. It is in that context Exs. P16 and
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17 came to be issued by the survey authorities. What the
survey authorities are expected to do before conducting the
survey is to issue notice to the adjoining land owners. They
are not the authorities to say who is in possession of the
land. They issued notices to the adjoining owners on the
basis of the title deed. They are not concerned with
possession. Even before conducting survey, they cannot say
in the notice issued for conducting survey who is in
possession of the property. In this background if it is
mentioned in Exs. P16 and P17 that the plaintiff is in
possession of the schedule property, it is because he is the
owner of the adjoining land and because he had filed
objections and as the suit had already been filed by the time
the said proceedings were initiated, he wanted to create
evidence and therefore he has got the same mentioned in the
notice. That notice is not proof of possession of the plaint
schedule property by the plaintiff. Unfortunately, the trial
Court did not consider this document in a proper
perspective. It failed to take note of the contents of the
159
registered sale deed which are validly executed and which
are not in dispute. It erred in holding that the sale deeds are
all executed in suspicious circumstances which is not a case
pleaded by any of the parties. It is on that assumption it has
recorded a finding that defendants 3 and 4 are not the bona
fide purchasers for valuable consideration, a finding which is
contrary to the evidence on record and as such, it is vitiated
and the same is hereby set aside.
POINT No. 4: LIMITATION
96. The defendants 3 and 4 contend that the suit
against them is barred by the law of limitation as they were
impleaded only on 6.8.2000, whereas suit was filed on
22.10.1993 and the date of the agreement being 5.11.1990
the suit is clearly barred by the law of limitation.
97. In this regard it is to be noticed that the plaintiff
has filed the suit for specific performance of the agreement of
sale dated 5.11.1990 on 22.10.1993 impleading only the first
160
defendant-the owner of the schedule property who had
executed the agreement of sale in his favour. The land in
question being an agricultural land, Section 132 of the
Karnataka Land Revenue Act, 1964 mandates that the
plaintiff shall annex with the plaint a certified copy of the
record of rights or register of mutation relevant to the lands,
failing which the plaint shall be rejected. The record of
rights and mutation extracts which are produced along with
the plaint were of the years 1988 and 1990 which only
reflected the name of the first defendant Hanumakka as the
owner. They are marked as Exs. P11 to P14. The suit
having been filed on 22.10.1993, the plaintiff ought to have
obtained the record of rights and mutation extracts as they
stood prior to the date of the suit. It has not been done. It
is the case of the defendants that, when the plaintiff was not
ready with the balance sale consideration, the agreement
came to be cancelled by cancellation deed dated 19.8.1992.
After such cancellation she has sold the properties to
defendants 2 to 4 to the knowledge of the plaintiff. Because
161
the plaintiff was aware that defendants 2 to 4 had purchased
the schedule property under three different sale deeds prior
to the date of the suit, deliberately the plaintiff did not obtain
and produce the record of rights and mutation extracts as on
the date of the suit. If only the record of rights and mutation
extracts had been obtained or an encumbrance certificate
had been obtained, it would have disclosed the name of
defendants 2 to 4 as the owners of the schedule property on
the date of the suit. Therefore, defendants 3 and 4 ought to
have been made defendants in the suit. As the defendants
wanted to obtain an order of temporary injunction against
the defendant No.1 not to alienate the property, these facts
which were all well within the knowledge of the plaintiff has
been deliberately suppressed.
98. The first defendant after service of notice filed
the written statement on 20.2.1994. In the written
statement so filed, in para 7 the defendant has categorically
stated that, though the defendant was entitled to forfeit the
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advance amount, she has graciously returned the amount
and got cancelled the original agreement dated 5.11.1990.
However, she has stated that the suit schedule property was
sold to one Lakshmi Thammaiah of Maddur and Padmini
Raghavan under two separate sale deeds registered in the
office of the Sub-Registrar, Devanahalli. The said land was
sold much earlier to the filing of the suit before the Court.
Out of the sale consideration received by the defendant, the
advance amount has been returned to the plaintiff by
canceling the original agreement dated 5.11.1990. The
plaintiff has executed a separate document canceling the
original agreement and also acknowledged having received or
having taken return of the advance amount from the
defendant. This document is in accordance with oral
understanding reached by plaintiff and defendant when
plaintiff was unable to perform his part of the agreement.
The said document dated 19.8.1992 cancelling the original
agreement dated 5.11.1990 was produced as Annexure – ‘X’
to the written statement.
163
99. From the aforesaid averments it is clear that, at
least on 20.2.1994 the plaintiff became aware that the first
defendant has sold the schedule property under registered
sale deeds in favour of defendants 2 to 4, but still the
plaintiff did not take any steps to get these defendants 2 to 4
impleaded as parties. No effective decree for specific
performance could be granted in the suit filed by the
plaintiff, as, on the date when the suit was filed, first
defendant had ceased to be the owner of the property and
defendants 2 to 4 had acquired title to the property. When
the plaintiff and first defendant probably colluded to defeat
the rights of defendants 2 to 4, the second defendant filed an
application for impleadment in the suit on 27.11.1995. In
fact, the plaintiff filed objections to the said application
opposing the impleadment. However, the trial Court passed
an order allowing the application and second defendant was
impleaded. The second defendant also in para 10 of the
written statement averred that, item Nos. B and D of the
schedule property was sold to one Mr. Anand-the fourth
164
defendant in the suit and item No. A of the schedule property
to one Mrs. Lakshmi Thammaiah-the third defendant, by a
registered sale deed dated 15.2.1992, i.e., much prior to the
institution of the suit by the plaintiff. Subsequently, katha
was also changed in favour of the defendants by an order
dated 21.9.1993 and therefore she contended the suit itself
is not maintainable in view of misjoinder and non-joinder of
parties. The said written statement was filed as aforesaid on
24.7.1996. Even then the plaintiff did not make any effort to
implead defendants 3 and 4. It is only after 3 long years on
2.8.1999 the application is filed by the plaintiff for
impleadment of defendants 3 and 4 which came to be
allowed. They were impleaded on 6.8.2000. These facts are
not in dispute. In this factual background, whether the suit
filed against defendants 3 and 4 is within limitation. In
order to answer this question it is necessary to look into the
relevant statutory provisions governing the issue. The
relevant Article is Article 54 of the Limitation Act 1963 which
reads as under:
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54. For specific performance of a contract
Three years
The date fixed for the performance, or, if no such date is fixed, when the plaintiff has notice that performance is refused.
100. Article 54 of the Act 1963 prescribes three years
as the period within which a suit for specific performance
can be filed. The period of three years is to be calculated
from the date specified in the agreement for performance or
in the absence of any such stipulation, within three years
from the date the performance was refused. Even if we
accept the interpolations regarding time for performance in
the agreement of sale as correct, then the suit filed by the
plaintiff on 22.10.1993 is well within time. But, admittedly
defendants 3 and 4 were not impleaded in the said suit.
Now, an application for impleadment has been filed only on
2.8.1999. What is the effect of such impleadment.
166
101. Order I Rule 10(4) and (5) of CPC deals with
addition of defendants. Where defendant is added, plaint to
be amended. It reads as under:-
(4) Where defendant added, plaint to be
amended.- Where a defendant is added,
the plaint shall, unless the Court otherwise
directs, be amended in such manner, as
may be necessary, and amended copies of
the summons and of the plaint shall be
served on the new defendant and, if the
court thinks fit, on the original defendant.
(5) Subject to the provisions of the Indian
Limitation Act, 1877 (15 of 1877), Section
22, the proceedings as against any person
added as defendant shall be deemed to
have begun only on the service of the
summons.
102. Therefore, it is clear that the proceedings as
against any person added as defendant shall be deemed to
have begun only on service of summons. Therefore, it is the
167
date which is subsequent to 2.8.1999. Sub-rule (5) makes it
clear the same is subject to the provisions of the Indian
Limitation Act, 1877 (15 of 1877)(Section 22). Now, Indian
Limitation Act, 1877 is repealed by the Limitation Act, 1908
by Act No. 9/1908. However, Section 22 is retained. It
reads as under:-
"22. Effect of substituting or adding new
plaintiff or defendant. (1) Where, after the
institution of a suit, a new plaintiff or defendant
is substituted or added, the suit shall, as regards
him, be deemed to have been instituted when he
was so made a party.
(2) Nothing in sub-section (1) shall apply to a case
where a party is added or substituted owing to
an assignment or devolution of any interest
during the pendency of a suit or where a plaintiff
is made a defendant or a defendant is made a
plaintiff".
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103. However, Limitation Act, 36/1963 repealed the
Limitation Act, 1908. Section 21 of the Act 36/1963
corresponds to Section 22. It reads as under : -
"21. Effect of substituting or adding new plaintiff
or defendant. (1) Where after the institution of a
suit, a new plaintiff or defendant is substituted or
added, the suit shall, as regards him, be deemed
to have been instituted when he was so made a
party:
Provided that where the court is satisfied
that the omission to include a new plaintiff or
defendent was due to a mistake made in good
faith it may direct that the suit as regards such
plaintiff or defendant shall be deemed to have
been instituted on any earlier date.
(2) Nothing in sub-section (1) shall apply to a case
where a party is added or substituted owing to
assignment or devolution of any interest during
the pendency of a suit or where a plaintiff is
made a defendant or a defendant is made a
plaintiff."
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104. It is clear from the aforesaid new provision, that
a proviso is added which was conspicuously missing under
the old Act. In the said proviso the word “good faith” has
been used. The word “good faith” in the proviso has been
defined under the Act at Section 2(h). It reads as under : -
"2.(h) "good faith-nothing shall be deemed to be
done in good faith which is not done with due
care and attention".
105. From a harmonious reading of these provisions
it is clear that, by virtue of sub-rule (5) of Rule 10 of Order I
of CPC where a defendant is added subsequent to the filing
of the suit, by way of impleadment, the plaint shall be
amended. After such amendment summons of the suit shall
be served on the new defendant. The proceedings as against
any person so added as defendant shall be deemed to have
begun only on the service of summons. It is subject to the
provisions contained in the Indian Limitation Act. In Section
22 of the old Act when a new defendant is added, the suit
170
shall as regards him be deemed to have been instituted when
he was so made a party. However, in the new Act a proviso
is added to the effect that if the omission to include a new
defendant was due to a mistake made in good faith, the
Court is vested with the power to direct that the suit as
regards such defendant shall be deemed to have been
instituted on any earlier date. But for this proviso, the suit
is deemed to have been instituted when the defendant who is
added was so made a party. These provisions had been the
subject matter of interpretation by the Apex Court.
106. The Supreme Court in the case of MUNSHI RAM
vs NARSI RAM AND ANOTHER [AIR 1983 SC 271] has held
as under:-
“7. It is clear from the foregoing that there was
no provision corresponding to the proviso to sub-
section (1) of section 21 of the Act in section 22 of
the repealed Act. Under the former Limitation Act
when after the institution of suit a new plaintiff or
defendant was substituted or added, the suit as
171
regards him was to be deemed to have been
instituted when he was so made a party. The
severity of the above law is sought to be reduced
by the introduction of the proviso to section 21 (1)
of the Act which provides that where the Court is
satisfied that the omission to include a new
plaintiff or defendant was due to a mistake made
in good faith, it may direct that the suit as
regards such plaintiff or defendant should be
deemed to have been instituted on any earlier
date. This change in section 21 of the Act appears
to have been made so that an omission to
implead a person owing to a bonafide mistake
does not deprive a plaintiff of his rights against
that person if the Court is satisfied in that behalf.
8. We shall now have to consider whether the
appellant is entitled to claim the benefit of the
proviso to section 21 (1) of the Act and if he is
entitled to it, what is the date on which the suit
against the party proposed to be newly added
should be deemed to have been instituted. It is
not disputed that the appellant had obtained a
certified copy of the sale deed in question from
the office of the Sub Registrar before the suit was
172
filed and in that copy only respondents 1 and 2
had been shown as the vendees. Munni Devi was
not shown in that copy as a vendee. The suit
which was filed on January 29, 1978 was well
within the period of limitation prescribed under
Article 97 of the Act as against respondents 1
and 2. There is no evidence to show that on the
date of the suit the appellant knew by any other
means that there was any other vendee who had
purchased the land along with respondents 1 and
2. In the written statement which was clearly
drafted, the name of Munni Devi was not
mentioned. It merely stated that all the vendees
had not been impleaded as defendants. The
original sale deed which was with respondents 1
and 2 was not produced in Court along with the
written statement. The appellant who had looked
into the certified copy of the sale deed asserted
that the plea that the suit should be dismissed for
non-joinder of necessary parties was untenable
as all the persons who were shown as vendees in
the certified copy had been impleaded. He had no
reason to suspect that there was an error in the
certified copy until the original sale deed was
read out in the trial court by the counsel for
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respondents 1 and 2 on June 14, 1978. It cannot
be presumed that the appellant must have known
that Munni Devi was also a vendee because the
vendor was his father. In fact the appellant had
nothing to gain by not impleading Munni Devi
also as a defendant when he filed the suit and
there could be no motive for doing so. It must,
therefore, be held that the omission to implead
her as a defendant was due to a mistake. If such
mistake is made in good faith, the proviso to
section 21 (1) of the Act would be attracted. The
meaning of the expression 'good faith' is
explained in section 2 (h) of the Act thus:
"2.(h) "good faith-nothing shall be deemed to be
done in good faith which is not done with due
care and attention".
9. In the instant case the appellant had
obtained a certified copy of the sale deed in
question and had filed the suit against
respondents 1 and 2 who alone had been shown
as the vendees in that copy. It has to be held that
in the circumstances he had acted with due care
and attention. When the original of the sale deed
174
was read out in Court by the counsel for
respondents 1 and 2, the appellant realised the
mistake and filed the application on the very next
date i.e. June 15, 1978 with all due diligence.
Hence we are of the view that the suit against
Munni Devi should be deemed to have been filed
on the date of the institution of the suit i.e.
January 29,1978 itself, which on the facts and in
the circumstances of the case, we consider,
should be treated as the 'earlier date' referred to
in the proviso to section 21 (1) of the Act. There is
no dispute that if the suit had been filed against
Munni Devi also on January 29, 1978 it would
have been in time and would not have suffered
from the defect of non-joinder of a necessary
party. The bar of limitation is thus got over by the
appellant. Because Munni Devi is a necessary
party, she has to be impleaded under sub-rule (2)
of Rule 10 of Order I of the Code of Civil
Procedure to enable the Court effectually and
completely to adjudicate upon and settle all the
questions involved in the suit. The application
filed by the appellant on June 15, 1978 is,
therefore, allowed. The amendment of the plaint
regarding the date of cause of action has thus
175
become unnecessary. The judgments and decrees
of the High Court, the first appellate court and the
trial court have, therefore, to be set aside as they
have been passed against the appellant only on
the ground of non-joinder of a necessary party
within time. They are accordingly set aside. The
suit has now to be remanded to the trial court to
dispose it of in accordance with law by recording
findings on the other issues which arise for
consideration in the suit. We accordingly do so.
The plaint shall be permitted to be amended by
the trial court by including the name of Munni
Devi as a defendant before issuing summons to
her.”
107. The Supreme Court in the case of
KARUPPASWAMY AND OTHERS vs C.RAMAMURTHY
[(1993) 4 SCC 41] has held as under:-
“4. A comparative reading of the proviso to
Sub-section (1) shows that its addition has made
all the difference. It is also clear that the proviso
has appeared to permit correction of errors which
have been committed due to a mistake made in
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good faith but only when the court permits
correction of such mistake. In that event its effect
is not to begin from the date on which the
application for the purpose was made, or from the
date of permission but from the date of the suit,
deeming it to have been correctly instituted on an
earlier date than the date of making the
application. The proviso to Sub-section (1) of
Section 21 of the Act is obviously in line with the
spirit and thought of some other provisions in Part
III of the Act such as Section 14 providing
exclusion of time of proceeding bona fide in court
without jurisdiction, when computing the period of
limitation for any suit, and Section 17(1) providing
a different period of Limitation starting when
discovering - a fraud or mistake instead of the
commission of fraud or mistake. While invoking
the beneficient proviso to Sub-section (1) of
Section 21 of the Act an averment that a mistake
was made in good faith by impleading a dead
defendant in the suit should be made and the
court must on proof be satisfied that the motion to
include the right defendant by substitution or
addition was just and proper, the mistake having
177
occurred in good faith. The court's satisfaction
alone breaths life in the suit.
6. The High Court relied on Ram Prasad
Dagduram v Vijay Kumar Motilal Mirakhanwala
(AIR 1967 SC 278) observing that it virtually
decided the point. It seems the High Court had
discerned and born in mind the following
observations of Bachawat, J. concurring with A.K.
Sarkar, C.J.:
“The Court has power to add a new
plaintiff at any stage of the suit, and in the
absence of a statutory provision like
Section 22 the suit would be regarded as
having been commenced by the new
plaintiff at the time when it was first
instituted. But the policy of Section 22 is to
prevent this result, and the effect of the
section is that the suit must be regarded as
having been instituted by the new plaintiff
when he is made a party, see Ramsebuk v.
Ramlall Koondoo (1881) ILR 6 Cal. 815. The
rigour of this law has been mitigated by the
provision to Section 21(1) of the Indian
178
Limitation Act, 1963, which enables the
court on being satisfied that the omission to
include a new plaintiff or a new defendant
was due to a mistake made in good faith,
to direct that the suit as regards such
plaintiff or defendant shall be deemed to
have been instituted on any earlier date.
Unfortunately, the proviso to Section 21(1)
of the Indian Limitation Act, 1963 has no
application to this case, and we have no
power to direct that the suit should be
deemed to have been instituted on a date
earlier than November 4, 1958.
(emphasis ours)
At the time of the cause the old Indian Limitation
Act, 1908, was in force.”
108. From the aforesaid judgments it is clear that,
under Section 22 of the repealed Act after the institution of
the suit when a defendant was added by way of
impleadment, the suit as regards him was to be deemed to
have been instituted when he was so made a party. The
179
severity of the above law is sought to be reduced by the
introduction of the proviso to section 21 (1) of the new Act
which provides that where the Court is satisfied that the
omission to include a new defendant was due to a mistake
made in good faith, it may direct that the suit as regards
such defendant should be deemed to have been instituted on
any earlier date. This change in section 21 of the Act has
been made so that an omission to implead a person owing to
a bonafide mistake does not deprive a plaintiff of his rights
against that person if the Court is satisfied in that behalf.
Therefore, this addition of the proviso to sub-section (1) has
made all the difference. The intention is to permit correction
of errors which have been committed due to a mistake made
in good faith, but only when the court permits correction of
such mistake. In that event its effect is not to begin from the
date on which the application for the purpose was made, or
from the date of permission, but from the date of the suit,
deeming it to have been correctly instituted on an earlier
date than the date of making the application. The said
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proviso is in line with the spirit and thought of other
provisions in Part III of the Act such as Section 14 providing
exclusion of time of proceeding bona fide in court without
jurisdiction, when computing the period of limitation for any
suit, and Section 17(1) providing a different period of
limitation starting when discovering a fraud or mistake
instead of the commission of fraud or mistake. While
invoking the beneficient proviso an averment that a mistake
was made in good faith by impleading should be made and
the court must on proof of the same be satisfied that the
motion to include the new defendant by substitution or
addition was just and proper and the mistake has occurred
in good faith. The court's satisfaction alone breaths life in
the suit.
109. Invoking this provision, an application under
Section 21(1) of the Limitation Act read with Section 104 of
the CPC is filed on 2.11.2010 before this Court requesting
this Court to hold that the impleadment of the appellants
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who are defendant Nos. 3 and 4 in O.S. No. 316/1993 is
deemed to have come on record on the date of institution of
suit i.e., on 22.10.1993. This application is registered as
Misc. Cvl. 19451/2010. In support of the application, the
plaintiff has sworn to an affidavit. After referring to the
plaint allegations and the contents of the agreement of sale,
in para 3 of the affidavit he has sworn to the fact that,
subsequent to service of summons, the respondent No.2
herein being the defendant No.1 appeared and she on 21-02-
1994 has placed the written statement on record. In the
written statement filed by her at para 7 she has stated that
she has sold the property to one Smt. Lakshmi Thimmaiah of
Maddur and Smt. Padmini Raghavan under two separate
sale deeds which are registered in the office of the Sub-
Registrar, Devanahalli. The defendant No.1 has not made
clear when she has sold the properties and to whom and
also did not furnish the correct name and address of the
purchasers nor did she produce the copies of those sale
deeds before the trial Court. At para 4 it is stated even after
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impleadment the defendant Nos.3 and 4 also did not produce
the sale deeds before the trial Court. The properties alleged
to have been purchased by the appellants herein were not
the subject matter of any revenue dispute. However, there
was a survey dispute between them and him, which has
taken shape in 2000-01 and by then they were already on
record as defendant No.3 and 4. As such he had no
knowledge about the said transactions effected by the
defendant No.1 in favour of the defendant Nos.3 and 4 and
about the sale transactions dated 15-02-2010 on the day
when he filed the suit. If he had the knowledge of the sale
transactions definitely he would have made them as
defendants in the suit filed by him. Subsequent to the
defendant No.1 filing of the written statement, he did his
level best to know as to who are all the persons who have
purchased the suit schedule properties from the defendant
No.1 and also the sale deeds executed by defendant No.1 in
their favour. Despite his sincere efforts he was unable to
trace out the sale deeds executed by the defendant No.1 in
183
favour of defendant Nos.3 and 4. On 20-11-1995 the counsel
appearing for defendant No.2 at the trial Court had served a
copy of the impleading application i.e., .I.A. No.3 on his
counsel stating that she has purchased the land bearing
Sy.No.112 measuring 10 acres situated at Thaligere, which
is one of the properties covered under the agreement of sale
deed 5-11-1990. Said application was moved on 3-1-1996.
His counsel who appeared before the trial Court had stated
no objection for allowing the said application i.e., IA No.3,
which came to be allowed on 11-3-1996. Subsequently, the
plaint was amended accordingly. As regards the
impleadment of the appellants in RFA No.1312/2003, who
was the defendant No.3 and 4 at the trial Court are
concerned, 3 days earlier to 21-06-1999 he went to the
concerned Village Accountant of Devanahalli to remit the
Kandayam in respect of the suit schedule properties i.e.,
during the third week of June 1999. The Village Accountant
declined to accept the Kandayam from him on the ground
that some one has remitted the same, when he questioned
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the Village Accountant as to who remitted the Kandayam in
respect of the suit schedule properties he revealed that Smt.
Lakshmi Thimmaiah, Sri V.T. Ananda have remitted the
Kandayam. He was shocked to hear the same. Then he
enquired with the Village account as to how the Kandayam
was received from them in respect of the lands bearing
Sy.No.108, 109, 113 of Thailgere Village. He after going
through the records maintained by him informed him that
1st defendant has sold the lands bearing Sy.No.109 and 113
in favour of V.T. Anand and Sy.No.108 in favour of Smt.
Lakshmi Thimmaiah, under the two sale deeds both dated
15-02-1992. After coming to know the same, he went and
searched in the Office of the Sub-Registrar, Devanahalli, to
verify the same. Upon search he was able to know that the
sale transaction effected by defendant No.2 in favour of
defendant Nos.3 and 4 on 15-02-1992. On 21-6-1999 he
applied for a certified copy of the said sale deeds dated 15-
02-1992 and the certified copies of the sale deeds were made
available to him on 24-06-1999. After obtaining the certified
185
copies of the sale deeds he came to know about the illegal
sale effected by defendant No.1 in favour of defendant Nos. 3
and 4. Thereafter he instructed his Advocate who was
appearing at the trial Court to make an application to
implead them as additional defendants. Accordingly, the
impleading application was filed on 02-08-1999 which was
allowed on 06-06-2000. The trial Court while allowing the IA
No.6 recorded as hereunder:
“It is submitted that the plaintiff was not aware of
these transactions when the suit was filed
against the defendants for specific performance of
the contract dated 05-11-1990. Since the
proposed defendants are necessary parties hence
IA No.6 filed by the plaintiff is allowed”.
110. Therefore, he contends that he had no
knowledge of the sale transactions effected by defendant
No.1 in favour of the appellants i.e., defendant Nos.3 and 4
till he obtained the certified copies of the sale deeds. It was
only on 24-06-1999 he came to know about the sale
186
transactions effected by 1st defendant in favour of defendant
Nos.3 and 4 i.e., upon going through the said sale deeds.
Therefore the delay was neither deliberate nor an intentional
one. On the other hand, it was for want of knowledge, which
is a mistake in good faith. The application for impleading
was not filed soon after the filing of the written statement by
the first defendant for the bonafide reason stated above.
When the suit filed was in time, the impleadment of the
defendant Nos.3 and 4 shall take effect from the date of the
suit and not from the date of allowing the application for
impleadment. Therefore, he prayed that the Court should
direct that the suit has been instituted on an earlier date i.e.,
on 22.10.1993.
111. An application under Section 5 of the Limitation
Act was also filed to condone the delay in filing the said
application on the very same day which is numbered as
Misc. Civil 19452/2010. Again the same averments are
reiterated in the affidavit filed in support of the application.
187
112. Defendants 3 and 4 have filed a detailed
objections to the said application. They contend that, the
discretionary power under Section 21(1) is exercisable only
by the trial Court and since the plaintiff/applicant had
neither sought for such a relief no such relief was granted by
the trial Court, the prayer in the present application is not
maintainable. The application is filed at an abnormally
belated stage. The application in question was not filed
before the trial Court but even before this Court the same is
filed at the fag end of the hearing of the appeal which has
been heard for several days and in fact, after the arguments
of the defendant No.3 and 4 is concluded. The applications
are filed more than 7 years after the filing of the appeal and
more than 11 years from the filing of the impleading
application in the trial Court. Therefore the said application
is not maintainable.
113. They have traversed the allegations in each and
every para and have contended that the conduct of the
188
plaintiff disentitles him to a discretionary relief of specific
performance. Apart from the fact that the date of knowledge
of the plaintiff is immaterial, various circumstances in the
case would clearly establish plaintiff’s knowledge of the sale
deed in favour of these appellants. The plaintiff is deemed to
have knowledge of the sale deed from the date of its
registration i.e., 26-06-1992 as per explanation 1 to Section
3 of the Transfer of Property Act, 1882. Furthermore as per
Section 132 of the Karnataka Land Revenue Act, 1964 which
mandates that the plaintiff should annex a certified copy of
the record of rights or register of mutation relevant to the
lands, failing which the plaint shall be rejected. In the
present case the plaintiff, being fully aware that prior to the
institution of the suit, defendant No.1 had sold items A, B
and D properties to the appellants herein, has attempted to
suppress the same by producing the revenue records of the
years 1988 to 1990 and not for the period between 1990 to
1993. This discloses the dishonest intention of the plaintiff.
Further more the written statements of defendants 1 and 2
189
filed on 20-02-1994 and 06-07-1996 also discloses the
execution of sale deeds in favour of the defendants 3 and 4.
However in spite of bringing the same to the knowledge of
the plaintiff, he has chosen not to implead them within the
prescribed period of limitation. Viewed from any angle the
averments made in the application are devoid of merit and
contains concoctions and inventions only for the purpose of
this application and therefore they sought for dismissal of
the application.
114. It is in the light of these averments in the
application filed under Section 21(1) of the Limitation Act
and in the background of this case we have to see whether
the omission to include defendants 3 and 4 was due to a
mistake made in good faith so as to invoke the discretionary
power conferred on the Court to condone the delay in
impleading defendants 3 and 4 and to hold that the suit as
against them is instituted on the day of the suit i.e.,
22.10.1993. In the case of Munshi Ram the Apex Court
190
condoned the delay because in the certified copy of the sale
deed which was obtained by the plaintiff in the said suit, it
only showed the name of two persons as vendees who were
impleaded in the suit as first defendant. The third
purchaser’s name was not found in the certified copies made
available. It is only when the original sale deed was read out
in the Court by the defendants, the plaintiff realised the
mistake and came to know that there was a third vendee.
Then realising the mistake, application was filed on the very
next day with all due diligence. In those circumstances, the
Court exercising the power under the proviso to Section
21(1) of the new Act held the suit is deemed to have been
filed on the date of the suit and not on the day the
application for impleadment is filed. That is the due
diligence that is expected before the Court could exercise its
power. In the instant case the suit is filed on 22.10.1993.
Section 132 of the Karnataka Land Revenue Act mandates
that, when the suit is filed in respect of the agricultural land,
record of rights and mutation extracts should accompany
191
the plaint, otherwise the plaintiff is to be rejected. The
plaintiff who was aware of the said provisions produced RTC
of the year 1988-89 as Exs. P11 to P14 which was for the
period 1988-1990. They ought to have obtained the RTC of
the period immediately prior to the suit, i.e., for 1992-93
which in the facts of the case we are convinced deliberately
they have not done. It is because in the examination in chief
of the plaintiff at para 7 he has stated that before the first
defendant sold the schedule properties to defendants 2 to 4,
he had cancelled the agreement of sale dated 5.11.1990.
Therefore, he was aware of the cancellation of the agreement
dated 5.11.1990 on the day he filed the suit. If he had only
obtained RTC or mutation extract or encumbrance certificate
he would have known the property had been alienated in
favour of defendants 2 to 4. In fact the defendants have
produced Exs. D22 and D23 which show their name was
entered in the RTC in respect of the schedule property on
20.9.1993, roughly a month prior to the filing of the suit.
As the plaintiff wanted an interim order restraining the first
192
defendant from alienating the property, he produced the
revenue records showing the first defendant as the owner
and then obtained an interim order restraining him from
alienating the property. However, on the day when the suit
was filed and on the day the injunction order was granted,
the alienation had already taken place. This is not a bona
fide conduct on the part of the plaintiff. After service of
summons, the first defendant entered appearance. She filed
her written statement on 20.2.1994 clearly setting out the
date of the sale deed under which she had sold the property
in favour of defendants 2 to 4. The grievance is that, full
particulars and addresses of the purchasers is not
furnished. If only the plaintiff had applied for encumbrance
certificate it would have given the full particulars of the
alienation made and after obtaining the said particulars they
could have applied for certified copies as was done in the
year 1999 and the certified copies of the sale deeds would
have disclosed the particulars of the defendants. That is the
due diligence expected of the plaintiff, which he has
193
miserably failed to exercise. The second defendant filed an
application to implead herself. After she was impleaded she
has filed her written statement on 24.7.1996 giving full
particulars of sale deed executed by the first defendant not
only in her favour, but also in favour of defendants 3 and 4.
Again the plaintiff did not raise his little finger. He did not
obtain the certified copies of the sale deed or the
encumbrance certificate. It is only 3 years thereafter, the
application for impleadment is filed on 2.8.1999. After
impleadment the plaintiff did not invoke the jurisdiction of
the Trial Court under Section 21(1) of the Limitation Act and
sought for condoning the delay and to treat the suit having
been filed against defendants 3 and 4 on the date of the suit
itself. Merely because the application was allowed by the
Court it does not have the effect of suit against defendants 3
and 4 being filed on the date of the suit. No such order is
passed. Therefore, when Order I Rule 10 application is
allowed, the effect is that the proceedings against the
defendant shall be deemed to have begun only on the date of
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service of summons. It is only when the Court passes an
order in terms of proviso to Section 21(1) of the Limitation
Act, 1963 it could be deemed to have been instituted on the
date of the suit. No application was filed. No prayer was
made. The trial Court proceeded and decreed the suit
without properly appreciating this legal position though
specific plea was taken in the written statement that the suit
action is barred by the law of limitation. Aggrieved by the
said judgment and decree dated 10-07-2003, the appellants
preferred the appeal before this Court. The appeal is filed on
16.10.2003. The appellants reiterated the said ground of
limitation in the said appeal memo. Appeal was heard by
another Bench. It is only when the appellant pointed out the
aforesaid provisions of law and contended before this Court
that the trial Court has committed serious error in holding
that the suit is in time then the present applications are
filed, nearly 7 years after the filing of this appeal. Therefore,
this application is filed 11 years after the application filed
under Order I Rule 10(2) CPC and 7 years after the filing of
195
the appeal. The Court gets the jurisdiction to pass an order
to the effect that the suit is deemed to have been instituted
on an earlier date only if the omission to include the
defendant was due to a mistake beyond good faith. Good
faith is defined under the Act to mean an act done with due
care and attention. Therefore, the admitted facts set out
above shows that there is no due care and attention
expected by the plaintiff throughout. The affidavit filed in
support of the application is full of falsehood, contrary to the
admitted material on record. The conduct of the plaintiff
throughout is mala fide. An attempt is made to suppress
facts from the Court. An interim order is obtained by
suppressing true facts. In spite of the fact that at the earliest
point of time this alienation is brought to the notice of the
plaintiff, he did not move his little finger to find out the
particulars of the alienation and to implead defendants at
the earliest point of time. Therefore, no case for exercising
the power under the proviso to Section 21(1) is made out. In
fact, that is a power to be exercised by the trial Court and
196
not by the Appellate Court. The Appellate Court is precluded
from exercising such power for the first time when no such
request is made to the trial Court and the trial Court has not
exercised the power. Suffice it to state in the facts of this
case, as the plaintiff has not exercised due care and
attention and this act is not in good faith, the plaintiff is not
entitled to the benefit of the proviso to Section 21(1) of the
Limitation Act, 1963. Consequently, the suit filed by plaintiff
against defendants 3 and 4 is clearly barred by the law of
limitation. Accordingly, the aforesaid Misc. Cvl. Application
Nos. 19451/2010 and 19452/2010 are liable to be
dismissed and they are dismissed.
POINT No.5: DELAY AND LATCHES
115. It is contended on behalf of the defendants that
the date of agreement is dated 5.11.1990. The legal notice is
issued on 19.1.1993, i.e., nearly after 2 years after the date
of the agreement. Even thereafter immediately suit is not
filed. 8 months thereafter second legal notice was issued on
197
21.9.1993. It is only thereafter the suit is filed on
22.10.1993, few days prior to the expiry of three years
period. Though the suit is filed within three years, whether
there was any justification for the delay in filing the suit. It is
only after the property is sold by the first defendant to
defendants 2 to 4, the suit is brought by interpolating the
suit agreement, i.e., the agreement of sale. The dates speak
for themselves.
116. The law on the point if fairly well settled. The
Supreme Court in the case of VEERAYEE AMMAL V. SEENI
AMMAL [(2002) 1 SCC 134] held as under:-
“11. When, concededly, the time was not of the
essence of the contract, the appellant-plaintiff
was required to approach the court of law within
a reasonable time. A Constitution Bench of this
Hon'ble Court in Chand Rani v. Kamal Rani held
that in case of sale of immovable property there is
no presumption as to time being of the essence of
the contract. Even if it is not of the essence of
198
contract, the court may infer that it is to be
performed in a reasonable time if the conditions
are (i) from the express terms of the contract; (ii)
from the nature of the property; and (iii) from the
surrounding circumstances, for example, the
object of making the contract. For the purposes of
granting relief, the reasonable time has to be
ascertained from all the facts and circumstances
of the case.”
It was furthermore observed:
13. The word “reasonable” has in law prima facie
meaning of reasonable in regard to those
circumstances of which the person concerned is
called upon to act reasonably knows or ought to
know as to what was reasonable. It may be
unreasonable to give an exact definition of the
word “reasonable”. The reason varies in its
conclusion according to idiosyncrasy of the
individual and the time and circumstances in
which he thinks. The dictionary meaning of the
“reasonable time” is to be so much time as is
necessary, under the circumstances, to do
conveniently what the contract or duty requires
199
should be done in a particular case. In other
words it means, as soon as circumstances permit.
In P. Ramanatha Aiyar's The Law Lexicon it is
defined to mean:
`A reasonable time, looking at all the
circumstances of the case; a reasonable time
under ordinary circumstances; as soon as
circumstances will permit; so much time as is
necessary under the circumstances, conveniently
to do what the contract requires should be done;
some more protracted space than `directly'; such
length of time as may fairly, and properly, and
reasonably be allowed or required, having regard
to the nature of the act or duty and to the
attending circumstances; all these convey more or
less the same idea.'
19. It is also a well settled principle of law that
not only the original vendor but also a subsequent
purchaser would be entitled to raise a contention
that the plaintiff was not ready and willing to
perform his part of contract. [See Ram Awadh
(Dead) by LRs. & Ors. v. Achhaibar Dubey & anr;
[(2000) 2 SCC 428 para 6]
200
20. We are, however, in agreement with Mr. Lalit
that for the aforementioned purpose it was not
necessary that the entire amount of consideration
should be kept ready and the plaintiff must file
proof in respect thereof. It may also be correct to
contend that only because the plaintiff who is a
Muslim lady, did not examine herself and got
examined on her behalf, her husband, the same
by itself would lead to a conclusion that she was
not ready and willing to perform her part of
contract.
21. If the plaintiff has failed to establish that she
had all along been ready and willing to perform
her part of contract, in our opinion, it would not be
necessary to enter into the question as to whether
the defendant Nos.5 and 6 were bona fide
subsequent purchasers for value without notice or
not.”
117. The Supreme Court in the case of
K.S.VIDYANADAM AND OTHERS vs VAIRAVAN [AIR 1997
SC 1751] has held as under: -
201
“9. Article 54 of the Limitation Act prescribes
three years as the period within which a suit for
specific performance can be filed. The period of
three years is to be calculated from the date
specified in the agreement for performance or in
the absence of any such stipulation, within three
years from the date the performance was
refused.
10. 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
202
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-
limits 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. As held by
a Constitution Bench of this Court in Chand Rani
v. Kamal Rani , "it is clear that in the case of sale
of immovable property there is no presumption as
to time being the essence of the contract. Even if it
is not of the essence of the contract, the court may
infer that it is to be performed in a reasonable
time if the conditions are (evident?): (1) from the
express terms of the contract; (2) from the nature
of the property; and (3) from the surrounding
circumstances, for example, the object of making
the contract". In other words, the court should
look at all the relevant circumstances including
the time-limits specified in the agreement and
determine whether its discretion to grant specific
performance should be exercised. Now in the case
of urban properties in India, it is well-known that
203
their prices have been going up sharply over the
last few decades - particularly after 1973*.
11. …… Indeed, we are inclined to think that the
rigor of the rule evolved by courts that time is not
of the essence of the contract in the case of
immovable properties - evolved in times when
prices and values were stable and inflation was
unknown - requires to be relaxed, if not modified,
particularly in the case of urban immovable
properties. It is high time, we do so. learned
Counsel for the plaintiff says that when the
parties entered into the contract, they knew that
prices are rising; hence, he says, rise in prices
cannot be a ground for denying specific
performance. May be, the parties knew of the
said circumstance but they have also specified
six months as the period within which the
transaction should be completed. The said time-
limit may no amount to making time the essence
of the contract but it must yet have some
meaning. Not for nothing could such time-limit
would have been prescribed. Can it be stated as
a rule of law or rule of prudence that where time
is not made the essence of the contract, all
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stipulations of time provided in the contract have
no significance or meaning or that they are as
good as nonexistent? All this only means that
while exercising its discretion, the court should
also bear in mind that when the parties prescribe
certain time-limits for taking steps by one or the
other party, it must have some significance and
that the said time-limits cannot be ignored
altogether on the ground that time has not been
made the essence of the contract [relating to
immovable properties].
118. The Apex Court in the case of MADEMSETTY
SATYANARAYANA V. YELLOJI RAO [AIR 1965 SC 1405],
held as under : -
“As Article 113 of the Limitation Act prescribes a
period of 3 years from the dated fixed thereunder
for specific performance of a contract, it follows
that mere delay without more extending up to the
said period cannot possibly be a reason for a
court to exercise its discretion against giving a
relief of specific performance. Nor can the scope of
the discretion, after excluding the cases
205
mentioned in Section 22 of the Specific Relief Act,
be confined to waiver, abandonment or estoppel.
If one of these three circumstances is established,
no question of discretion arises, for either there
will be no subsisting right or there will be a bar
against the assertion. So, there must be some
discretionary field unoccupied by the three cases,
otherwise the substantive section becomes otiose.
It is really difficult to define that field. Diverse
situation may arise which may induce a court not
to exercise the discretion in favour of the plaintiff.
It may better be left undefined except to state
what the section says, namely, discretion of the
court is not arbitrary,, but sound and reasonably
guided by judicial principles and capable of
correction by a court of appeal.
[emphasis supplied]
Subba Rao, J., speaking for the Bench, pointed
out the distinction between Indian Law and the
English Law on the subject and stated the
conclusion in the following words: "While in
England, mere delay or laches may be a ground
for refusing to give a relief of specific
performance, in India mere delay without such
conduct on the part of the plaintiff as would
206
cause prejudice to the defendant does not
empower a court to refuse such a relief.... It is not
possible or desirable to lay down the
circumstances under which a court can exercise
its discretion against the plaintiff. But they must
be such that the representation by or the conduct
or neglect of the plaintiff is directly responsible in
inducing the defendants to change his position to
his prejudice or such as to bring about a situation
when it would be inequitable to give him such a
relief."
13. In the case before us, it is not mere delay. It is
a case of total inaction on the part of the plaintiff
for 2½ years in clear violation of the term of
agreement which required him to pay the
balance, purchase the stamp papers and then
ask for execution of sale deed within six months.
Further, the delay is coupled with substantial rise
in prices - according to the defendants, three
times - between the date of agreement and the
date of suit notice. The delay has brought about a
situation where it would be inequitable to give the
relief of specific performance to the plaintiff.”
207
119. From the aforesaid judgment of the Apex Court it
is clear that, in the case of sale of immovable property there
is no presumption as to time being the essence of the
contract. Even if it is not the essence of the contract, the
Court may infer that it is to be performed within a reasonable
time, if the conditions are evident from the express terms of
the contract, from the nature of the property and from the
surrounding circumstances. For example, the object of
making the contract. In other words, the Court should look at
all the relevant circumstances including the time-limits
specified in the agreement and determine whether its
discretion to grant specific performance should be exercised.
One such fact which the Courts should take note of is that in
the case of urban properties in India, it is well-known that
their prices have been going up sharply over the last few
decades - particularly after 1973. This rule that the time is
not the essence of the contract in the case of immovable
properties was evolved in times when prices and values were
stable and inflation was unknown. The same requires to be
208
relaxed, if not modified, particularly in the case of urban
immovable properties. Where time is not the essence of the
contract, but still when stipulations of time is provided in the
contract, the significance or meaning of such stipulation as to
time cannot be completely ignored. The Court while
exercising the discretion should also bear in mind that when
the parties prescribe certain time limits for taking steps by
one or the other party, it must have some significance and
that the said time limits cannot be ignored altogether on the
ground that time has not been made the essence of the
contract. While in England, mere delay or laches may be a
ground for refusing to give a relief of specific performance, in
India mere delay without such conduct on the part of the
plaintiff as would cause prejudice to the defendant does not
empower a Court to refuse such a relief. If the conduct or
neglect of the plaintiff is directly responsible in inducing the
defendants to change his position to his prejudice or such as
to bring about a situation when it would be inequitable to
209
give him such a relief, the Court will be well within its
jurisdiction to refuse specific performance.
120. In the instant case, the agreement stipulates 6
months as the period of stipulation. According to the parties
it was reduced to 3 months by way of correction.
Subsequently, 3 months has been made 13 months by way
of interpolation. As is clear from the terms of the agreement,
out of the sale consideration of Rs.3,47,100/-, Rs.75,000/-
was paid under the agreement according to the first
defendant. According to the plaintiff Rs.1,75,000/- was
paid. According to the interpolated term, Rs.1,00,000/- has
to be paid within 13 months and the balance amount is to be
paid within 3 months. As is clear from the terms of the
agreement, there is no corresponding obligation which is to
be performed by the first defendant before the plaintiff pays
the balance consideration agreed upon. Within the time
stipulated plaintiff has not pointed out to the defendant No.1
what is the obligation she was expected to perform so that
210
the plaintiff could pay the balance consideration and obtain
a sale deed. In the evidence an attempt is made to contend
that, in the agreement of sale it is mentioned that the
balance consideration was payable only after the property is
surveyed and the sale deed is to be executed. There is no
such recital in the sale deed. On the contrary, the recital is,
it is the responsibility of the first defendant to get the
measurement of the property done and boundaries fixed.
She has already handed over xerox copies of all the
documents of title. The said survey and fixing the boundary
was not a condition precedent for the plaintiff to pay the
balance sale consideration as contended. Therefore, the
plaintiff ought to have paid the balance consideration
according to them within 13 months, according to the first
defendant within 3 months. However, the plaintiff has not
paid the amount even according to his own case. It is
because he did not possess the requisite money, he agreed to
the cancellation of the sale deed. Consequently, the first
defendant sold the property and from the consideration
211
received the first defendant instead of forfeiting the amount
has returned Rs.75,000/- received under the agreement of
sale to the plaintiff. It is in this context, if really the plaintiff
has paid Rs.1,75,000/- as contended by them and was ready
and willing to pay the balance amount of Rs.1,72,100/-
within 13 months and if the defendant has not come forward
to execute the sale deed, though time is not the essence of
the contract, the suit for specific performance ought to have
filed within a reasonable time. It is here for nearly two long
years the plaintiff has not raised his little finger. There is no
demand in writing. As set out earlier, there is no material
placed on record to show that he was ready with the balance
sale consideration. The plaintiff has chosen to file the suit
few days prior to the expiry of the period of limitation. In
that context, it is not a case of mere delay, it is a case of total
inaction on the part of the plaintiff for two years in clear
violation of the terms of the agreement which required him to
pay the balance consideration and then ask for execution of
the sale deed. Further, as the plaintiff was badly in need of
212
money after cancelling the agreement of sale, she has
proceeded to sell the property to defendants 2 to 4. They
have purchased the property for a valuable consideration.
The second defendant has purchased it on the assumption
that the suit agreement is cancelled. In so far as defendants
3 and 4 are concerned, they are not aware of the agreement
of sale at all. As the defendants 2 to 4 have purchased the
schedule property for valuable consideration and have taken
possession of the property and have invested money for its
improvement coupled with the fact that the mutation entries
are made in their name, they are paying taxes, the delay in
filing the suit has brought about a situation where it would
be inequitable to give the relief of specific performance to the
plaintiff. Moreover, when the plaintiff has not come to the
Court with clean hands, he has interpolated the material
terms of the agreement of sale, certainly such conduct
disentitles the plaintiff from invoking the discretionary relief
of specific performance at the hands of this Court.
213
APPLICATION FOR ADDITIONAL EVIDENCE
121. This application – Misc. Civil No. 13365/2010 is
filed by the second defendant for production of additional
documents, namely a Xerox copy of the cancellation deed
dated 13.8.1992 and a copy of the reply to the legal notice
dated 22.2.1993. The first defendant in para 8 of her written
statement has categorically stated that the original
agreement dated 5.11.1990 is cancelled by a deed of
cancellation dated 13.8.1992. It is also stated the original
agreement is produced as Annexure-X to the written
statement. However, the same was not marked during trial.
It is submitted that the same was not available. Therefore,
in the appeal the aforesaid application is filed along with a
Xerox copy of the said agreement and a copy of the legal
notice requesting the Court to permit the second defendant
to produce the said documents.
122. This Court by its order dated 13.9.2010 after
going through the order sheet dated 4.3.1994 of the trial
214
Court in O.S. No. 316/1993 had noticed that the said
document is kept in safe custody. Therefore, this Court
directed the High Court registry to secure the documents. In
pursuance of the said direction issued, the document was
secured as is clear from the order sheet dated 4.10.2010.
Therefore, the original is also now before the Court. But, the
question is, whether the application filed under Order 41
Rule 27 CPC requires to be allowed.
123. The said documents are relied on by the
defendants to show that the suit agreement is cancelled and
therefore the suit is liable to be dismissed and no specific
performance could be granted on the basis of an agreement
which is cancelled. From the discussions aforesaid, we have
held the suit document is interpolated and therefore the
material alteration in the suit agreement has rendered the
agreement of sale void, unenforceable and has the effect of
canceling the document. We have also held that the plaintiff
was not ready and willing to perform his part of the contract
215
and therefore he is not entitled to specific performance. We
have also further held that defendants 3 and 4 are bona fide
purchasers for valuable consideration without notice of the
suit agreement. Further, we have held the suit against
defendants 3 and 4 is barred by limitation. Lastly, we have
held the suit is liable to be dismissed on the ground of delay
and latches. Therefore, we have already come to the
conclusion that the suit is liable to be dismissed on the
aforesaid grounds.
124. In the light of the aforesaid findings recorded
already, this additional evidence which is now sought to be
produced, if proved would show that the suit agreement is
cancelled and it is not enforceable. Even without such a
deed of cancellation we have held the suit agreement stands
cancelled because of interpolation and not enforceable for
the reasons set out therein. Therefore, no prejudice is
caused to defendant No.2 by not allowing her to rely on these
documents. Even without those documents she succeeds in
216
the suit. For the aforesaid reasons we do no not see any
justification to allow the said application. Accordingly, the
application is dismissed.
125. In the light of the aforesaid discussion, the
judgment and decree of the trial Court is liable to be set
aside. Hence, we pass the following:-
O R D E R
(a) Both the appeals are allowed.
(b) The judgment and decree of the trial Court is hereby
set aside.
(c) The suit of the plaintiff is dismissed.
(d) The plaintiff is liable to pay costs of these appeals.
Sd/- JUDGE
Sd/- JUDGE
JT/CKL