2001 Supreme(SC) 1023

2001(5) Supreme 576
SUPREME COURT OF INDIA
(From Madras High Court)
V.N. Khare and Mrs. Ruma Pal, JJ.
V. Pechimuthu -Appellant
versus
Gowrammal -Respondent
Civil Appeal No. 336 of 1997
Decided on 1-8-2001
Counsel for the Parties :
For the Apppellant : K. Ram Kumar and B. Sridhar, Advocates.
For the Respondent : R. Sundaravaradan, Sr. Advocate, R.N. Keshwani, Sanjay Kunur and Ramlal Roy, Advocates.

IMPORTANT POINT
For reasons stated in this judgment High Court was not justified either in law or on facts in setting aside a concurrent finding of fact in a suit for specific performance within the limits prescribed by Section 100 C.P.C. 1908.

Headnote:Specific Relief Act, 1963-Sections 6, 16 and 20-C.P.C. 1908- Section 100-Suit for specific performance-Decreed by Trial Court confirmed by 1st Appellate Court-High Court in second appeal set it aside-Appeal to Supreme Court-Whether High Court was justified in setting aside a concurrent finding of fact within the limits prescribed by Section 100 C.P.C.? ( No, both in law and on facts)-Appeal allowed-Case law referred.

       Held : The learned Judge reversed the concurrent finding of the Trial Court and the first appellate Court and held on a construction of the plaint that the right of re-conveyance was a concession or a privilege granted to the original owner and that therefore not only must the terms of such agreement be strictly construed against him, but also unlike "ordinary" agreements for sale, time would be of the essence of the contract. It was held that such an owner claiming re-conveyance had to strictly perform the argument (sic) before the right could be enforced. Since, according to the High Court, the appellant had wanted a settlement of accounts before the performance of the agreement, the intention of the appellant was not to implement the agreement in terms thereof and as such he was not entitled to specific performance. The Learned Single referred to the following decisions in support of his conclusions, (1) Shanmugam Pillai v. Annalakshmi Ammal, AIR 1950 FC 38, (2) K. Simrathmull v. Nanjalingaiah Gowder, AIR 1963 SC 1182, (3) Hasam Nurani Malak v. Mohan Singh and Anr., AIR 1974 Bom. 136, (4) S. Sankaran (dead) and 4 others v. N.G. Radhakrishnan, 1994(2) L.W. 642. (Para 11)

       The conclusion of the High Court is un-sustainable in law and contrary to the facts. (Para 12)

       On law held : To sum up: the mere fact that an agreement for sale is described as a re-conveyance does not by itself mean that it is an option to repurchase nor does it in any way alter the substance of the deed. It merely records a historical fact - that the property which is to be sold was being purchased by the person who used to be the owner. No logical distinction can be drawn between an agreement to re-purchase and an ordinary agreement of purchase just because the vendor happens to be the original purchaser and the purchaser happens to be the original vendor. The agreement remains an agreement for sale of immovable property and must be governed by the same provisions of law. (Para 19)

       Coming to the facts of the case, there is no dispute that the appellant sent a legal notice to the respondent offering to pay the entire amount of Rs. 19,990/- to the respondent well within the period specified in the agreement. The suit was also filed before 3rd May 1979. Nothing further remained to be done by the appellant under the agreement. As far as the deposit of the balance consideration was concerned under Explanation (1) to Section 16(c)* of the Specific Relief Act, 1963 the appellant could wait for an order of the Court to do so. That is what he did. Both the Trial Court and the first appellate Court on a consideration of all the evidence therefore rightly came to the conclusion that the appellant was ready and willing to perform his obligations under the agreement and was entitled to specific performance of it. The second error committed by High Court was in disturbing the concurrent finding of fact merely on a construction of the plaint on a point not raised by the respondent at any stage of the proceedings. It was not the respondent s case either in the written statement nor before the Trial Court or the first appellate Court that the appellant was not entitled to specific performance only because he had allegedly claimed a variation in the consideration price. On the other hand it was the respondent who had all along claimed such a variation. When the appellant called upon the respondent prior to the institution of the suit to re-convey the property on payment of Rs. 19,990/-, it was the respondent s case that the appellant was liable to pay a larger sum to the respondent than the amount mentioned in the agreement. This stand was repeated by the respondent in her written statement and also on first appeal. The respondent had herself put in issue the amount of sale consideration payable under the agreement. Having done that, she could not turn around and contend that it was the appellant who was asking for a variation of the agreement. In fact the first appellate Court found that the claim for various credits had been raised by the appellant for the first time only after the respondent had claimed monies over and above the sale consideration of the agreement for re-conveying the property. The High Court should not in the circumstances have permitted the respondent to raise an inconsistent argument at the stage of the second appeal. (Paras 20 & 21)

       Held on 1st reason : In the case before us, the appellant has proved the agreement made and the parties were not at issue as to its existence. The appellant had expressed his readiness and willingness to perform the agreement by paying the consideration fixed not once but repeatedly in several paragraphs of the plaint. The High Court erred in overlooking the fact that the appellant had never said that the consideration for re-conveyance under the agreement was less than what was stated. Conceding that, the appellant had merely claimed credit for certain amounts. This could not mean that he was seeking a variation in the agreement itself. (Para 23)

       The second reason given by the High Court for denying the appellant the relief of specific performance was under Section 20 of the Specific Relief Act, 1963. Relying upon Kommisetti Venkata Subbarayya v. Karamsetti Venkateswarlu and others, AIR 1971 A.P. 279 and Buchiraju v. Sri Ranga Satyanarayana, AIR 1967 A.P. 69 the High Court held that the appellant had not come to the Court with clean hands since he had falsely claimed that he had not received any amount under the first deed of sale from the respondent. The appellant s suit was accordingly dismissed. This again was not an issue raised by the respondent at any stage nor does any argument appear to have been advanced in this regard by the respondent before the Trial Court or the first appellate Court at all. Furthermore, the first appellate Court had not, as wrongly stated by the High Court, held that the claims of the appellant were false. The District Judge, which was the final Court of fact, expressly refused to go into the question of payment of the balance consideration by the respondent under the sale deed because he held, and in our view rightly so, that in the suit for specific performance the Court was not concerned with whether any consideration had been paid under the original sale deed executed by the appellant in favour of the respondent. The decisions noticed by the High Court in this connection were accordingly wholly inapposite. (Para 24)

       Held incidentally : Counsel for the respondent finally urged that specific performance should not be granted to the appellant now because the price of land had risen astronomically in the last few years and it would do injustice to the respondent to compel her to re-convey property at prices fixed in 1978. The argument is specious. Where the Court is considering whether or not to grant a decree for specific performance for the first time, the rise in the price of the land agreed to be conveyed may be a relevant factor in denying the relief of specific performance. [ see K.S. Vidyanadam and Others v. Vairavan, 1997(3) SCC 1. But in this case, the decree for specific performance has already been passed by the trial Court and affirmed by the first appellate Court. The only question before us is whether the High Court in second appeal was correct in reversing the decree. Consequently the principle enunciated in K.S.Vidyanadam (supra) will not apply. (Paras 25 & 26)

       Held finally : For the foregoing reasons, the appeal is allowed. We set aside the judgment of the High Court and uphold the decision of the first appellate Court but there will be no order as to costs. (Para 27)