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IN THE HIGH COURT OF JUDICATURE AT CALCUTTA
JYOTIRMAY BHATTACHARYA, SHIB SADHAN SADHU, JJ.
Sri. Palay Dutta & Ors. - Appellants
Vs.
Md. Ali Afsar & Ors. - Respondents
F.A. 80 of 2014 With CAN 11029 of 2015 & 1141 of 2016
Decided On : 05-04-2016
SPECIFIC PERFORMANCE OF CONTRACT - AGREEMENT FOR SALE - IMPOUNDMENT OF AGREEMENT - ADMISSIBILITY OF EVIDENCE - SECTION 36 OF THE STAMP ACT - READINESS AND WILLINGNESS TO PERFORM CONTRACT - SECTION 16(C) OF SPECIFIC RELIEF ACT - EXCEPTION CLAUSE UNDER SECTION 19(B) OF SPECIFIC RELIEF ACT - BONA FIDE PURCHASER FOR VALUE WITHOUT NOTICE - DISCRETIONARY POWER OF COURT UNDER SECTION 20 OF SPECIFIC RELIEF ACT - CLEAN HANDS DOCTRINE - MAINTAINABILITY OF SUIT - CAUSE OF ACTION.
Fact of the Case:
Plaintiffs filed a suit for specific performance of contract for sale of a property. The agreement for sale was impounded by the court for insufficient stamp duty, but was later admitted into evidence. The plaintiffs failed to recover possession of the suit property from an unauthorized occupier, as required by the contract. The defendant No. 10 purchased the property from the defendants Nos. 1-9 after publishing a public notice and without any notice of the plaintiffs' agreement. The plaintiffs claimed to have paid taxes and corrected erroneous recordings in the municipal records.
Finding of the Court:
1. The agreement for sale was admissible in evidence despite being impounded, as per Section 36 of the Stamp Act. 2. The plaintiffs failed to prove their readiness and willingness to perform their part of the contract, as required by Section 16(c) of the Specific Relief Act, by not recovering possession of the suit property. 3. The defendant No. 10 was a bona fide purchaser for value without notice of the plaintiffs' agreement and thus protected under Section 19(b) of the Specific Relief Act. 4. The court had the discretionary power under Section 20 of the Specific Relief Act to refuse specific performance due to the plaintiffs' unclean hands, including making false claims and misleading statements. 5. The suit was not maintainable as the plaintiffs never demanded specific performance based on the agreement dated 22nd April 2002.
Issues: 1. Whether the impounded agreement for sale was admissible in evidence. 2. Whether the plaintiffs proved their readiness and willingness to perform the contract. 3. Whether the defendant No. 10 was a bona fide purchaser for value without notice. 4. Whether the court could exercise its discretion to refuse specific performance. 5. Whether the suit was maintainable.
Ratio Decidendi: 1. Section 36 of the Stamp Act bars challenges to the admissibility of a document once it has been admitted into evidence. 2. Plaintiffs must prove their readiness and willingness to perform their part of the contract, including fulfilling any conditions precedent, to obtain specific performance. 3. A bona fide purchaser for value without notice is protected under Section 19(b) of the Specific Relief Act and cannot be compelled to perform a contract entered into by their predecessors in interest. 4. The court has the discretion to refuse specific performance under Section 20 of the Specific Relief Act if the plaintiff does not approach the court with clean hands. 5. A suit for specific performance is not maintainable if the cause of action did not mature due to the plaintiff's failure to make a proper demand for performance.
Final Decision: The appeal was dismissed with costs, affirming the judgment and decree of the lower court. The application for additional evidence was also dismissed. The court declined to grant a stay of the operation of the judgment and decree as there was no executable order capable of execution.
Jyotirmay Bhattacharya, J.
This first appeal is directed against the judgment and decree passed by the learned Civil Judge (Senior Division), 5th Court at Alipore on 12th October, 2012 in Title Appeal No. 5 of 2005 at the instance of the plaintiff/appellant.
2. By the impugned judgment and decree the plaintiffs' suit for specific performance of contract was dismissed by the learned Trial Judge on contest by holding, inter alia, that the plaintiffs having failed to deposit the impounded fees on the agreement for sale, the agreement for sale cannot be admitted into evidence and as such, the said agreement for sale cannot be enforced by a decree for specific performance of contract. The learned Trial Judge also held that the contract is a time bound contract, and since the plaintiffs have failed to complete the transaction within the time fixed under the contract, the plaintiffs are not entitled to get any decree for specific performance of contract. The learned Trial Judge also held that the plaintiffs having failed to prove their readiness and willingness to perform their part of the contact, are not entitled to get any decree for specific performance of contract. The suit for specific performance of contract filed by the plaintiffs was thus, dismissed on the aforesaid three grounds. The legality and/or correctness of such judgment and decree passed by the learned Trial Judge are now under our scrutiny in this First Appeal.
3. Let us now consider the merit of the instant appeal in the facts of the present case. Initially the plaintiffs filed a suit for declaration that the defendant Nos. 1 and 2 are bound to execute the deed of conveyance and/or conveyances and register the same through appropriate authority and thereby giving the legal title, interest and possession of the said property to the plaintiffs in terms of the said agreement and permanent injunction for restraining the defendants and/or their men and agents from transferring, selling and/or creating any lease or also alienating or encumbering the suit property in any manner and/or from dispossessing the plaintiffs from their possession.
4. Subsequently the plaint filed in the said suit was amended repeatedly and ultimately a decree for specific performance of contract was sought for by the plaintiffs in the said suit. It was contended in the amended plaint that the plaintiffs entered into an agreement with the defendant Nos. 1-9 on 22nd April, 2002 for purchasing the suit property for a consideration of Rs. 21,00,000/- (Rupees twenty one lakhs). At the time of execution of the said agreement, the plaintiffs paid a sum of Rs. 50,00,00/- (Rupees fifty thousand) to the defendant Nos. 1-9 towards earnest money being part payment of the consideration money. Rest of the consideration money was agreed to be paid within July, 2002. It was, however, provided in the said agreement that if the plaintiffs procure a developer and enter into an agreement with him for development of the suit property after recovering possession thereof from the unauthorized occupant who is in possession thereof after expiry of his lease, then the time for payment of the said sum of Rs. 2,00,000/- (Rupees two lakh) towards the part payment of the balance consideration money will be extended by defendant Nos. 1-9. It was also provided that the said agreement will remain valid for a period of one year from the date of execution of the said agreement.
5. The plaintiffs claimed that in pursuance of the said agreement possession of the suit property was delivered to the plaintiffs by the defendant Nos. 1-9. It was also alleged by the plaintiffs that the plaintiffs paid all outstanding and current property taxes of the said premises in terms of the said agreement and also got the erroneous recording of the said property as Wakf property corrected by the Municipal authority and caused recording of the names of Msmt Ahimi Begum, Mr. Tusama etc. as Matawali thereof deleted from the assessment records of
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