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2008 Supreme(Bom) 1736
High Court of Judicature at Bombay
THE HONOURABLE MRS. JUSTICE ROSHAN DALVI
P.K. Thilakan - Appellant
Versus
Vitthal N. Shetty - Respondent
Suit No. 3275 Of 1987
Decided On : 12 December 2008
Headnote:Transfer of Property Act, 1882 - Section 53-A - Claim of benefit of Section 53-A of Act - Readiness and willingness - Part performance of agreement - Tenantable interest in Hotel premises to be assigned under agreement - Party put in possession of premises as conductor of opposite party’s hotel business and not in part performance of agreement - Value of assignment not agreed upon - Such assignment can only be upon adequate consideration of prevailing value of premises in dispute - Readiness and willingness to pay consideration agreed upon must be shown by party at later stage - Said consideration have to be paid at time of agreement - Or ready and willing to pay current market value by considering escalation of market price. - What must be appreciated is that no fall under the umbrella of Section 53-A the defendant must show not only readiness and willingness to pay the consideration amount mentioned in the declaration at a later stage, now as later as 21 years, but he should have either actually paid consideration agreed upon at time of such agreement and before the price escalated to insist upon assignment of the premises in his possession, or be ready and willing to pay the current market price. What must also be considered is that the defendant was not put in possession in part performance of the agreement of the parties to assign the premises to him as stated in the declaration/ affidavit of 21st September, 1984, but was only in the suit premises as Conductor of the plaintiffs business. That is not juridical possession of the defendant. Hence Section 53-A could not apply to his case. See AIR 1989 Gauhati 39, Sunil Sarkar v. Aghar Basu.
Though the execution of the agreement as well as the affidavit are seen to be proved by the interpretation of the agreement read as a whole seen alongwith the plaintiff’s cross-examination of acceptance of his signature on the affidavit when shown to him, the defendant would be entitled to enforce the assignment as agreed between the parties under the declaration/affidavit dated 21st September, 1984, only upon payment of consideration. That would have to be at the market value of the suit property at the relevant time. The defendant has shown that he was always ready and willing to pay the consideration. He has also meetings between the parties to that end contended that time for payment was extended to enable the plaintiff to obtain the consent of the landlord or the plaintiff. However, the defendant has not shown actual payment of the consideration by tender of a cheque issued in favour of the plaintiff prior to the termination of the period of the agreement as required of him. The defendant continued in possession after the agreement came to an end. The defendant continued carrying on his business even after the declaration/affidavit was executed. The defendant was required to insist upon the assignment. That would have been only upon offer of the consideration.
Oral Judgment:
1. The Plaintiff is the owner of the hotel Park View. He is the tenant of the hotel premises at Shop No.5, Room No.4/1, Ground floor, Kantharia Manshion, Plot No.103-C, Govandi Road, Chembur, Bombay- 400 071.
2. The Plaintiff entered into Conducting Agreement with the Defendant dated 16th August 1984 to allow the Defendant to conduct his hotel business for 3 years from the date of the agreement. The suit is filed after the agreement expired by efflux of time for recovery of the premises for which the agreement was entered into.
3. ThePlaintiff has claimed mesne profits of Rs.500/-per day from the expiry of the agreement period i.e., from 16th August 1987. The Plaintiff has also prayed for an injunction to restrain the Defendant from disposing off, alienating, encumbering or creating any 3rd party right in the suit premises. The Plaintiff has also prayed for a declaration that a declaration/affidavit dated 21st September 1984 stated to have been executed by him is void.
4. It has been the case of the Defendant that by a separate declaration/affidavit dated 21st September 1984 the Plaintiff agreed to assign his interest in the suit premises to the Defendant for
Rs.6,50,000/- inclusive of the deposit amount of Rs.1,50,000/-given by the Defendant to the Plaintiff at the time of the execution of the agreement dated 16th August 1984. It has been the Plaintiffs case that the Plaintiff has not executed any such declaration/affidavit and the Plaintiff has applied for declaring the said document null and void.
5. It is the Defendants defence that as per the declaration/affidavit of the Plaintiff dated 21st September 1984 agreeing to assign the interest of the Plaintiff in the suit premises for the consideration mentioned therein, the Plaintiff is bound to assign the suit premises to the Defendant. It is his case that he has always been ready and willing to make payment of consideration for the assignment and has offered the same to the Plaintiff. He, therefore, contends that the Plaintiff cannot recover the suit premises from the Defendant upon the expiry of the agreement by efflux of time.
6. The parties have entered into correspondence prior to the suit in which their contentions are the same.
7. It would be apt to set out the specific admissions to narrow down the controversy in an otherwise simple action for recovery of possession at the end of the period of the agreement for conducting the Plaintiffs business. The admitted facts are as under:-
1. ThePlaintiff is the owner of the suit business.
2. ThePlaintiff is the tenant of the suit premises.
3. The license in respect of the suit premises stood in the name of the Plaintiff, and continues to stand in his name. A beer license, which was to be obtained, had in fact, been obtained in the name of the Plaintiff though at the expenses of the Defendant after the Conducting Agreement was executed.
4. ThePlaintiff entered into a Conducting Agreement with the Defendant on 16th August 1984. The Plaintiff had initially renovated the suit premises and was conducting a business of running a hotel therein since 13th January 1966. The premises had remained vacant and unused for some time prior to the execution of the Conducting Agreement.
5. Theagreement expired by efflux of time on 15th August 1987.
6. This suit is filed on 10th November 1987.
8. Based upon the pleadings between the parties and considering the aforesaid admissions, the only real dispute between the parties is with regard to the effect of Declaration/affidavit dated 21st
September 1984. Hence the following issues are framed and answered as follows:-
ISSUES FINDINGS
1. Whether the agreement dated 16th August 1984 was an agreement for conducting simplicitor or, in effect, an agreement for conducting– -cum- agreement for sale of Hotel Park View. As per reasons given
2. Whether the Plaintiff executed the declaration/affidavit dated 21st September 1984 and agreed to assign the hotel premises to the Defendan
