2000 Supreme(Kar) 471
Karnataka High Court
C.NAZEER AHMED - Appellant
Versus
S.JAHAN ARA - Respondent
Decided On : 07-28-00
R.F.A. : 454 of 1991
Amaresh, B.MANOHAR, Sri S.M.Hegde
Headnote:Contract Act, 1872-Section 55-Contract to sell estate-Time essence of contract-Time is not the essence of such contract-such intention has to be evidenced by circumstances which are strong enough to displace initial presumption.
Certainly. Based on the provided legal document, here are the key points summarized:
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The case involves an appeal against a judgment for specific performance of a property sale agreement, where the plaintiff sought to enforce the sale of immovable property against the defendant (!) .
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The agreement stipulated that the remaining consideration was to be paid within six months from the date of the second payment, with provisions for extension and interest in case of delay. However, the agreement did not explicitly make time of the essence for the completion of the sale (!) (!) .
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The court found that the parties did not treat time as a fundamental or essential element of the contract, and the stipulations regarding time were subordinate to the main purpose of the agreement. The conduct of the parties and surrounding circumstances supported the view that completion within a strict period was not a fundamental requirement (!) (!) .
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The defendant failed to fulfill certain obligations, notably the eviction of tenants from the property, which was a condition precedent for the sale. The defendant's contradictory statements about the tenancy status further indicated non-compliance with contractual obligations (!) (!) .
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The plaintiff was always ready and willing to perform his part of the contract, and had the resources to do so, but the defendant's failure to vacate the property prevented the completion of the sale (!) (!) .
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The court concluded that non-performance by the defendant, particularly regarding eviction of tenants, excused the plaintiff's delay or non-payment of the remaining consideration, and the plaintiff's willingness to proceed was established (!) (!) .
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The appeal was dismissed, affirming that the agreement did not treat time as the essence of the contract, and the defendant's non-compliance prevented the enforcement of the specific performance (!) .
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( 1 ) THIS is a defendant's appeal against the judgment and decree passed by the court of civil judge, chickmagalur in a suit for specific performance filed by the respondent. The controversy arises in the following circumstances:- by an agreement dated 3rd of December 1982, the defendant in the suit and appellant herein agreed to sell in favour of the plaintiff- respondent certain immovable property described in the schedule to the agreement for a total consideration of rs. 3,25,000/ -. A sum of Rs. 20,000/- was received by the defendants-seller at the time of execution of the agreement while a further amount of Rs. 30,000/ was to be paid by the purchaser within 45 days thereafter. The agreement provided that the remaining consideration of Rs. 2,76,000/- shall be paid to the seller at the time of registration of the sale deed within six months from the date the additional amount of Rs. 30,000/- was paid. It is not disputed that the appellant-seller received a sum of more than Rs. 50,000/- in instalments at different points of time. the amount so received was sought to be forfeited by the seller in terms of a notice dated 7th of September 1983 sent to plaintiff-purchaser, in which the seller accused the purchaser of failure to pay the balance amount and to have the sale deed executed in her favour. The purchaser promptly sent a reply to the said notice, in which the allegation that she had failed to pay the balance amount and have the sale deed executed in her favour was denied. It was also alleged that the execution of the sale deed and the making of the final payment were postponed till the end of March 1994 at the request of the seller for the reason that he had not till 5th of may 1983 when he received a sum of Rs. 15,000/ succeeded in getting the tenanted portion of the suit property vacated from the tenants in occupation. This position was denied by the seller, who asserted in a rejoinder sent on 21st of September 1983 that there were no tenants in occupation of the property and that the same being in his possession could be vacated within one week from the date a demand to that effect was made by the purchaser. Suffice it to say that the" positions which the parties took made as s'uit for special performance inevitable. In the written statement filed by the appellant- seller several contentions were raised besides a challenge to the agreement executed between the parties on the ground that it required the seller to perform an act impossible of performance viz. , evicting his tenants within six months. The trial court framed seven issues in all. While deciding issue no. 1, it held that the plaintiff was at all times ready and willing to perform her part of the contract. Issue No. 2 was also decided in favour of the plaintiff-purchaser with the finding that the defendant had agreed to receive the final payment before the end of March 1994. While deciding issues nos. 3 to 6 the court below held that the defendant-seller had agreed to evict the tenants before the registration of the sale deeds and that the plaintiff was entitled to a decree for specific performance. The additional issue relating to the validity of the agreement between the parties, was also decided against the defendant-seller and the suit decreed, aggrieved whereof, the seller-appellant has preferred the present appeal as already noticed earlier appearing for the appellant Sri amaresh strenuously argued that the agreement that time was the essence of the agreement executed between the parties. He laid considerable stress on the terms incorporated in the agreement especially para-10 thereof, which according to him did not envisage any extension for payment of the balance money and consequent registration of the sale deed beyond seven months from the date fixed for payment of the sum of Rs. 30,000/- under para-3 of the agreement. He argued that the failure of the purchaser to arrange the payment of the balance amount would result in an automatic c