IMPORTANT POINT
Suit for Specific Performance – Court should look at all relevant circumstances including time limit(s) specified in agreement and determine whether its discretion to grant specific performance should be exercised.

JUDGMENT :

B.R. GAVAI, J.

1. This appeal challenges the judgment dated 17th October 2008 passed by the learned Division Bench of the High Court of Judicature, Andhra Pradesh at Hyderabad in Letters Patent Appeal No. 26 of 1999, thereby partly allowing the appeal filed by the present appellants.

2. Facts in brief giving rise to the present appeal are as under:

The defendant is the owner of the suit property. The defendant executed an agreement of sale in favour of the plaintiff for sale of the suit property. The total consideration was fixed at Rs. 45,315/-. The plaintiff paid an amount of Rs. 15,000/- by way of Demand Draft dated 7th July 1978 as advance payment. The defendant addressed a letter to the plaintiff on 13th October 1978 stating therein that, she was ready to execute the sale deed and that she was coming to Hyderabad the week thereafter for the said purpose. The said communication was responded to by the plaintiff on 20th October 1978, requesting to confirm whether the necessary permission from the Competent Authority (hereinafter referred to as the “ULC Authorities”) under the Urban Land (Ceiling and Regulation) Act, 1976 (for short “ULC Act”) to sell the suit property had been obtained or not. Immediately thereafter, the plaintiff purchased stamp papers on 23rd October 1978. On 8th December 1978, the defendant applied to the Secretary to Government of Andhra Pradesh, Revenue Department for granting exemption under Section 20 of the ULC Act for selling the suit property. Another communication was addressed by the plaintiff on 30th December 1978, requesting the defendant to inform him as soon as the requisite permission under the ULC Act has been obtained. On 3rd March 1980, the defendant addressed a communication to the plaintiff stating therein that the concerned official had promised her to do the needful.

3. On 12th April 1982, the defendant addressed a communication to the plaintiff stating therein that the requisite permission from the ULC Authorities could not be obtained and therefore, she had cancelled the agreement of sale dated 29th July 1978. The defendant had also enclosed a Demand Draft of Rs. 15,000/- for the purpose of refund of advance amount. The plaintiff replied to the defendant vide communication dated 2nd May 1982 that, the contract was binding and returned the said Demand Draft. He reiterated that he was always ready to make the payment and execute the sale deed. It was also contended by him that because of the spiraling price rise, the defendant was going back on the promise. The defendant, on 2nd June 1982 addressed a letter to the plaintiff, stating therein that, she was forfeiting the advance payment of Rs. 15,000/- since the plaintiff had not claimed the refund within 90 days from the date of the agreement of sale. Thereafter, there were certain other communications between the parties.

4. The Government of Andhra Pradesh, vide G.O.Ms. No. 161 dated 7th February 1984, granted exemption to the defendant under the provisions of Section 20 of the ULC Act. After coming to know about the same, on 19th February 1984, the plaintiff issued a legal notice to the defendant for execution of the sale deed in pursuance of the agreement of sale dated 27th July 1978. Since the defendant did not respond, the plaintiff filed a suit bearing OS No. 139 of 1984 before the trial court seeking specific performance of the agreement of sale dated 29th July 1978. The trial court, vide judgment and decree dated 29th April 1988, decreed the suit directing the defendant to execute the sale deed within 2 months from the date of the judgment and decree.

5. Being aggrieved thereby, the defendant (since deceased) through legal representatives filed an appeal being Appeal No. 1415 of 1998 before the High Court. The learned Single Judge of the High Court, vide judgment dated 24th September 1998, allowed the appeal and dismissed the suit of the plaintiff. Being aggrieved thereby, the plaintiff filed an appeal being LPA No. 26 o