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2009(1) Supreme 302
SUPREME COURT OF INDIA
(From Andhra Pradesh High Court)
S.B. Sinha and Cyriac Joseph, JJ.
G. Jayashree & Ors. — Appellants
versus
Bhagwandas S. Patel & Ors. — Respondents
Civil Appeal No. 4451 of 2008
[With Civil Appeal No. 4452 of 2008]
Decided on : 19-12-2008
(b)Specific Relief Act, 1963 – Sections 15 and 20 – Suit for specific performance of contract should be filed at the first instance – Plaintiff’s conduct plays an important role in the matter of exercise of discretionary jurisdiction by a court of law – However, some delay may not be a bar in granting a relief of specific performance. (Paras 30 and 32)
(2008) 7 SCC 310; (2005) 8 SCC 242; (1997) 3 SCC 1; (1965) 2 SCR 221; (2002) 8 SCC 146 – Relied upon.
AIR 1937 Nagpur 186; (1978) 1 SCR 770; AIR 1979 Madras 130; (2004) 1 SCC 769 – Distinguished.
(1897) ILR 24 Calcutta 832 – Referred.
Facts of the case :
1. Respondents No. 1 to 3 are owners of the land measuring 11 Acres and 39 Gunthas in Survey No. 36 situated at village Satamrai of Shamshabad Mandal in the district of Ranga Reddy.
2.The said respondents entered into an agreement for sale with Mohammed Kasim Ali and G. Srinivas Reddy, whose heirs and legal representatives are the appellants, for sale of the said property for a sum of Rs. 18,00,000/-, out of which a sum of Rs. 1,00,000/- was paid as earnest money.
3.Besides the above agreement of sale, the said two vendees had also entered into an Agreement of sale with one S. Yadagiri, his sons and some others for sale of land measuring 90 Acres in Survey No. 643 to 658, which is adjacent to the land of the respondents.
4. Pursuant to or in furtherance of the said agreements of sale, the said vendees had applied for a joint layout for the entire land of 101.39 acres and a sum of Rs.1,54,725/- was paid by the said vendees towards layout permit fee and developmental charges vide undated receipt.
5. The owners filed an application for grant of layout not only in respect of Survey No. 36 but also for grant of layout permission in respect of other plots. By a communication dated 26.4.1985, the said Shri Yadagiri was informed about the grant of layout not only in respect of the land of which he was the owner but also in respect of Survey No. 36.
6. At that stage the owners of the land — defendants Nos. 1 to 3 requested the vendees to lay the roads as directed by HUDA by 31.7.1985 failing which the said agreement of sale would be deemed to have been terminated and the earnest money of Rs.1,00,000/- paid by the said vendees would stand forfeited.
7. Mohammed Kasim Ali did not want to involve himself in the matter of purchase of the said land in terms of the said agreement of purchase. Alleging breach of the terms of the said agreement on the part of the defendant nos. 1 to 3, he filed a suit
8. The matter was taken to the High Court.
9.Mohammed Kasim Ali died on 19.4.1987 and after his death his wife, the legal representative, entered into a compromise with the owners of the land out of the court.
10. G. Srinivas Reddy and the owners filed suits for grant of mandatory injunction.
11. G. Srinivas Reddy, thereafter filed another suit for specific performance of the agreement of sale
12.The learned judge opined that a suit for specific performance of contract at the instance of the plaintiff alone was maintainable although Mohammed Kasim Ali was not to be a party to the deed of sale.
13.The High Court, on the other hand, reversed the said findings of the learned trial judge.
Finding of the Court :
No interference is warranted with the discretionary jurisdiction exercised by the High Court.
Result : Appeal dismissed with cost.
JUDGMENT
S.B. Sinha, J. —
1.Plaintiffs in a suit for grant of decree for specific performance of contract are before us aggrieved by and dissatisfied with the judgment and decree dated 13.11.2007 passed by a Division Bench of the Andhra Pradesh High Court reversing a judgment and decree dated 25.10.1995 of the Additional Subordinate Judge, Ranga Reddy district at Saroornagar, Hyderabad in Original Suit No. 191 of 1987 dismissing the said suit.
2.The basic facts of the matter are not in dispute.
Respondents No. 1 to 3 are owners of the land measuring 11 Acres and 39 Gunthas in Survey No. 36 situated at village Satamrai of Shamshabad Mandal in the district of Ranga Reddy. The said land abuts National Highway No. 7 between Hyderabad and Bangalore. The said respondents entered into an agreement for sale with Mohammed Kasim Ali and G. Srinivas Reddy, whose heirs and legal representatives are the appellants, for sale of the said property for a sum of Rs. 18,00,000/-, out of which a sum of Rs. 1,00,000/- was paid as earnest money.
Some of the important clauses contained in the said agreement for sale read as under:
“1.The total consideration being Rs. 18 lakhs, the Vendees have paid a sum of Rs.1,00,000/- (Rupees One lakh only) to the Vendor as the earnest money. The balance sum of Rs.17 lakhs shall be paid within 6 months of release of tentative layout HUDA.
2.The sale shall take effect within 6 months from the release of tentative layout from B.U.D.A. (Bhagyanagar Urban Development Authority).
3.The actual physical possession of the property shall remain with the Vendors only. However, the Vendors hereby give permission to the Vendees to go over the property and divide the property into different plots. The expenses for dividing plots and leaving roads shall also be borne by the Vendees. The Vendees are entitled at their own expenses to obtain the layout permission from Competent Authority. The Vendees are also hereby permitted to use the Telephone however they shall be liable to pay Telephone bills.
xxx xxx xxx
5.The above stipulated time for sale to take effect may be extended by the Vendor. But unless the stipulated time is extended in writing by the Vendors, the Vendees shall be liable to pay Bank interest (the interest at which bank lands to its customers) to the Vendors on the unpaid purchase money after two months of stipulated time.
xxx xxx xxx
7.The Vendors are owners of 11 acres 39 gunthas falling in S. No. 36. However, the Vendors have fenced the property giving set back from the Road. The Vendees shall be entitled to obtain compensation for the unfenced land from the concerned Government authorities.
8.As the Vendees are in the business of selling plots, the Vendees shall be liable to pay the sale consideration of each plot proportionately on the same day to the Vendors when the Vendors effect sale of that particular plot.”
3.Indisputably, besides the above agreement of sale, the said two vendees had also entered into an Agreement of sale with one S. Yadagiri, his sons and some others for sale of land measuring 90 Acres in Survey No. 643 to 658, which is adjacent to the land of the respondents.
4.Pursuant to or in furtherance of the said agreements of sale, the said vendees had applied for a joint layout for the entire land of 101.39 acres and a sum of Rs.1,54,725/- was paid by the said vendees towards layout permit fee and developmental charges vide undated receipt. The relevant portion of the said receipt reads as under:
“It is not part of sale consideration, for any reason, the amount is refunded, the same should be returned without any delay to the PURCHASERS. The Agreement period will be 8 MONTHS after the release of TENTATIVE LAYOUT from HUDA for SURVEY No. 36 of SATMRAI Village and for SURVEY NUMBERS 645, 647, 653, 654, 655/1, 657, 658, 666/2 and PART SURVEY NUMBERS 644, 646, 651, 655 is 15 MONTHS after the release of TENTATIVE LAYOUT from HUDA. After the above period for the unpaid balance of sale consi
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