SUPREME COURT OF INDIA
INDIRA BANERJEE, HRISHIKESH ROY, JJ.
U.N. Krishnamurthy (Since Deceased) Thr. Lrs. - Appellant
Versus
A. M. Krishnamurthy – Respondent
CIVIL APPEAL NO. 4703 OF 2022 [ARISING OUT OF SLP (C) NO. 19463 OF 2018]
Decided On : 12-07-2022
Specific Performance - Agreement for Sale of Property - Specific Relief Act, 1963 - Section 16(c)
Fact of the Case:
The case involved a dispute over the specific performance of an agreement for the sale of a property. The respondent plaintiff claimed that the appellant had agreed to sell the property but failed to execute the sale deed despite receiving an advance payment.
Finding of the Court:
The court found that the respondent plaintiff failed to prove continuous readiness and willingness to perform his part of the contract, as required by Section 16(c) of the Specific Relief Act, 1963. The court held that the respondent plaintiff's deposit of the balance sale consideration in court after a significant delay did not establish his readiness and willingness to perform the contract.
Issues: The main issue was whether the respondent plaintiff had proved his continuous readiness and willingness to perform his part of the contract, as required by Section 16(c) of the Specific Relief Act, 1963.
Ratio Decidendi: The court emphasized the importance of proving continuous readiness and willingness to perform the essential terms of the contract, especially in cases involving the payment of money. It highlighted the need for the plaintiff to demonstrate availability of funds or arrangements to obtain the necessary funds within the stipulated time.
Final Decision: The court allowed the appeal, set aside the judgment and decree of the trial court and the high court, and directed the appellants to return the earnest money to the respondent plaintiff with interest. The respondent plaintiff was not entitled to the relief of specific performance.
JUDGMENT :
Indira Banerjee, J.
Leave granted.
2. Heard Mr. Krishnan Venugopal learned Senior Advocate appearing with Mr. Mahesh Thakur, AOR on behalf of Appellants and Mr. N.D.B Raju, learned Advocate appearing with Mr. M.A. Chinnasamy, AOR on behalf of Respondent.
3. This Appeal is against a final judgment and decree dated 30th October 2017 passed by the High Court of Judicature at Madras, dismissing the Appeal Suit No. 262 of 2011 filed by the Appellants and confirming a judgment and order and decree dated 30th November 2010 passed by the Principal District Judge, Krishnagiri, hereinafter referred to as “the Trial Court” in Original Suit No. 30 of 2005 filed by the Respondent Plaintiff, for specific performance of an agreement for sale of the suit property.
4. In the plaint, it is pleaded that the original Defendant U.N. Krishnamurthy’s father, U.R. Narasaiah had executed a will on or about 9th May 1984, bequeathing the suit property to the original Defendant, U.N. Krishnamurthy (since deceased). After the death of his father, U.R. Narasaiah, on 25th April 1987, the original Defendant U. N. Krishnamurthy became the absolute owner of the suit property.
5. It is the case of the Appellants that on 11th November 2002, while the original Defendant was getting the suit property whitewashed, a real estate agent Mr. N. Anjappa approached the original Defendant with an offer to arrange the sale of the suit property at a good price.
6. As per the pleadings in the plaint, the original Defendant agreed to sell the suit property to the Respondent Plaintiff, in the presence of Mr. N. Anjappa, Mr. S.A. Muralidharan and Mr. M. Murali Reddy. The terms and conditions of the agreement for sale of the suit property were recorded by the original Defendant U.N. Krishnamurthy in his own handwriting in a letter dated 11th November 2002 given by the original Defendant to the Respondent Plaintiff.
7. It is the case of the Respondent Plaintiff that the original Defendant agreed to sell the suit property to the Respondent Plaintiff for a consideration of Rs.15,10,000/-, out of which sum of Rs.10,001/- was paid by the Respondent Plaintiff to the original Defendant in advance. It was further agreed between the parties, that the Respondent Plaintiff would get the sale deed registered on or before 15th March 2003, upon payment of the full sale consideration. The agreement was allegedly witnessed by the real estate agent, Mr. N. Anjappa.
8. According to the Respondent Plaintiff, the Respondent Plaintiff approached the original Defendant with the balance consideration several times and requested the original Defendant to execute the sale deed in his favour, but the original Defendant kept postponing execution of the sale deed on one pretext or the other.
9. On or about 13th February 2003, the Respondent Plaintiff issued a legal notice to the original Defendant through his lawyer stating that the Respondent Plaintiff is ever ready and willing to perform his part of the contract and called upon the original Defendant to execute the sale deed in favour of Respondent Plaintiff after receiving the balance consideration. By a letter dated 10th March 2003 sent in response to the aforesaid legal notice, the original Defendant denied having entered into any oral sale agreement for sale of the suit property.
10. On 8th October 2005, the Respondent Plaintiff allegedly approached the original Defendant with a request to receive the balance consideration and to execute the sale deed in favour of the Respondent Plaintiff. It is alleged that the original Defendant went back upon his promise and refused to accede to the request made by the Respondent Plaintiff.
11. In the circumstances, on or about 17th October 2005, the Respondent Plaintiff filed the suit. The original Defendant filed a written statement denying the allegations in the plaint. In the written statement, the original Defendant denied the execution of any agreement for sale of the suit property for consideration of Rs.15,
Chand Rani v. Kamal Rani [(1993) 1 SCC 519]
Manjunath Anandappa v. Tammanasa
P.R. Deb and Associates v. Sunanda Roy
Saradamani Kandappan v. S. Rajalakshmi
Sri Raja Lakshmi Dyeing Works v. Rangaswamy Chettiar
H.K.N. Swami v. Irshad Basith (2005) 10 SCC 243]
B.M. Narayana Gowda v. Shanthamma
Madhukar v. Sangram (2001) 4 SCC 756]
Santosh Hazariv. Purushottam Tiwari
Malluru Mallappa v. Kuruvathappa
Ardeshir Mama v. Flora Sassoon
His Holiness Acharya Swami Ganesh Dassji v. Sita Ram Thapar
Umabai v. Nilkanth Dhondiba Chavan (2005) 6 SCC 243
N.P. Thirugnanam v. Dr. R. Jagan Mohan Rao and Ors.
Ardeshir Mama v. Flora Sassoon
Pt. Prem Raj v. D.L.F. Housing and Construction (Private) Ltd. And Anr.
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Time is of the essence of a contract if the parties have agreed that it is or if the circumstances of the case show that it is.
A plaintiff seeking specific performance must prove continuous readiness and willingness to fulfill the contract's terms, especially when time is considered essential, otherwise relief can be denied.
The main legal point established in the judgment is the requirement for the plaintiff to prove financial capacity and willingness to perform the contract, as mandated by Section 16(c) of the Specific....
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