IMPORTANT POINTS
1. In terms of Section 16(c) of the Specific Relief Act, 1963, it is incumbent on the party, who wants to enforce the specific performance of a contract, to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract.
2. When there was a specific understanding between the parties as reflected in the clauses in the Agreement within which period the sale was to be completed, it had to be construed that intention of the parties was to treat time as essence of contract.

JUDGMENT

P.Sathasivam,J. —

1) This appeal is directed against the final judgment and decree dated 17.02.2003 passed by the Division Bench of the High Court of Judicature at Madras in O.S.A. No. 163 of 1994 whereby the appeal filed by the respondents herein was allowed.

2) Brief facts:

(a) The appellant is a Private Limited Company (hereinafter referred to as “the appellant-Company) registered under the Companies Act, 1956 and is carrying on the business of manufacturing, selling, exporting, trading in and distribution of Pesticides, Chemicals and Agro Chemicals. Respondent No. 1 is also a Private Limited Company (hereinafter referred to as “the respondent-Company”) registered under the Companies Act, 1956 in which Mr. T.P. Narayanan - respondent No.2 is the Chairman and Director and appeal against him stood dismissed vide this Court’s order dated 19.07.2004. Mr. T.K. Gopinath (since died) was the Managing Director - respondent No.3 and his legal representatives are on record. In the year 1981, the appellant-Company required a property around Mount Road Area near Mylapore, Madras for establishing a Research and Development Centre. Respondent-Company, on coming to know about the said requirement, offered its property measuring 12 grounds 33 sq. ft. with buildings at Door No. 46, Cathedral Road, Madras. The officials of the appellant-Company inspected the property and after getting it evaluated by an Authorized Valuer offered a price of Rs.82 lakhs for the entire property and the Respondent Nos. 2 & 3 herein accepted the same. Thereafter, an Agreement for Sale was executed between the parties on 28.08.1981 and a sum of Rs. 2 lakhs was paid by way of cheque as advance.

(b) Pending investigation of title of the respondent-Company to the suit property, the appellant-Company entered into the said agreement since the respondents desired a firm commitment to be made. Clauses 3 and 4 of the said Agreement put the vendor under an obligation to produce all documents of title in its possession or control relating to the suit property for the investigation and approval of the appellant-Company. Besides, getting other necessary clearances, the respondents were also required to get the Income Tax Clearance Certificate as specified under Section 230-A of the Income Tax Act, 1961.

(c) In accordance with the above, the appellant-Company called upon the respondents to furnish the documents of title, the details of the encumbrances on the property, if any, and also Income Tax Clearance Certificate and other necessary clearances to complete the sale. On 09.09.1981, the respondents furnished the Income Tax Clearance Certificate dated 07.09.1981 and promised to furnish the other required documents very soon. They also demanded a further payment of Rs. 10 lakhs as advance pending finalization of the sale to which the appellant-Company did not agree.

(d) As the respondents did not furnish the required documents, the appellant-Company issued a letter dated 14.09.1981 calling upon them to furnish the required documents. Instead of furnishing all the required documents, as sought for, the respondents, vide letter dated 15.09.1981, called upon the appellant-Company to expedite the sale. Thereafter, on 19.09.1981, the appellant-Company again requested the respondents to furnish the solvency certificate. In response to the above-said letters, the respondents orally apologized for the delay and promised to furnish the required details at the earliest and respondent No.2 also requested for a further payment of Rs.10 lakhs as advance to enable them to discharge the mortgage subsisting in favour of Bank of India. The appellant-Company paid Rs. 5 lakhs to respondent No.2 on 21.09.1981 on the undertaking that the documents called for would be sent by 30.09.1981. Again on the request of respondent No.2, the appellant-Company paid a further sum of Rs. 5 lakhs to meet the Urban Land Ceiling Clearance. A total sum of Rs. 12 lakhs was paid to the respondents. On 19.10.1