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1989 Supreme(Del) 237

High Court Of Delhi
AJIT PRASAD JAIN - Appellant
Versus
N.K.WIDHANI - Respondent
Suit 389 of 1977
Decided On : 05/26/1989

Advocates Appeared:
B.B.Sharma, B.P.BERI, M.S.PAVAN, MINAKSHI SINGH, P.K.Seth, Uma Datta, VIJENDER JAIN

A contract for sale by itself does not create any interest in or charge on such property.

Headnote:

SPECIFIC PERFORMANCE - AGREEMENT TO SELL - READINESS AND WILLINGNESS TO PERFORM - UNACCOUNTED MONEY - FABRICATED DOCUMENTS - URBAN LAND (CEILING AND REGULATION) ACT - FOREIGN EXCHANGE REGULATION ACT - SECTION 31.

Fact of the Case:

Plaintiff seeks a decree of specific performance in respect of property No. 59, Babar Road, Bengali Market, New Delhi, owned by defendants I to 5, who are the sons of Defendant No. 6. The case of the plaintiff is that the defendants entered into an agreement for sale of the suit property with the plaintiff on 19. 12. 1976. The agreement was signed by defendant No. 6 as attorney of defendant No. 2 as well as on his own behalf. It was also signed by defendants 1, 3 to 5. A sum of Rs. 10,000. 00 in cash was paid as earnest money The sale price of the suit property was settled at Rs. 2,65,000. 00. The defendants had undertaken to give vacant possession of the. suit property to plaintiff soon after the payment of Rs. 1,65,000. 00 to defendant No. 6 on behalf of the defendants. Another sum of Rs. 35,000/ was payable within 15 days of the date on which the permission of Land and Development Officer, New Delhi, is communicated to the plaintiff by defendant No. 6. he balance amount of Rs. 55,000. 00 was payable at the time of registration of the sale deed before the Sub Registrar, Delhi/new Delhi.

Finding of the Court:

The court found that the plaintiff was ready and willing to perform his part of the contract, that the defendants were not justified in refusing to deliver possession of the suit property, and that the plaintiff was entitled to a decree of specific performance. The court also found that the agreement to sell was not void under Section 31 of the Foreign Exchange Regulation Act, 1973.

Issues: 1. Whether the suit in the present form is maintainable ? 2. If issue No. I is decided in favour of the plaintiff, whether the plaintiff is not entitled to the relief claimed because of the provisions of section 27 of the Urban Land (Ceiling Regulation) Act, 1976, and also for want of permission from Land and Development Officer, New Delhi ? 3. Whether the plaintiff has committed breach of the contract as alleged in paras 8 and 9 of the written statement. If so to what effect ? 4. Whether the plaintiff has been ready and willing and is still ready and willing to perform his part of the contract ? 5. In case if specific performance is refused to the plaintiff whether he is entitled to damages in the alternative. If so, to what amount ? 5a : Whether the agreement to sell is void and in-operative in view of the reasons stated in preliminary objection No. 4 of the amended written statement dated 12th February 1980.

Ratio Decidendi: 1. The court held that the plaintiff was entitled to a decree of specific performance because he had always been ready and willing to perform his part of the contract, and the defendants were not justified in refusing to deliver possession of the suit property. 2. The court also held that the agreement to sell was not void under Section 31 of the Foreign Exchange Regulation Act, 1973, because that section only places a restriction on a foreign citizen on transfer or sale, mortgage, lease, gift, settlement or otherwise of any immoveable property situate in India except with the previous general or special permission of the Reserve Bank of India. The said provisions do not place any restriction on entering into agreement like Ex. PW2/1.

Final Decision: The court decreed specific performance of the agreement to sell in favor of the plaintiff.

Y. K. Sabharwal J.

( 1 ) PLAINTIFF seeks a decree of specific performance in respect of property No. 59, Babar Road, Bengali Market, New Delhi, owned by defendants I to 5, who are the sons of Defendant No. 6. The case of the plaintiff is that the defendants entered into an agreement for sale of the suit property with the plaintiff on 19. 12. 1976. The agreement was signed by defendant No. 6 as attorney of defendant No. 2 as well as on his own behalf. It was also signed by defendants 1, 3 to 5. A sum of Rs. 10,000. 00 in cash was paid as earnest money The sale price of the suit property was settled at Rs. 2,65,000. 00. The defendants had undertaken to give vacant possession of the. suit property to plaintiff soon after the payment of Rs. 1,65,000. 00 to defendant No. 6 on behalf of the defendants. Another sum of Rs. 35,000/ was payable within 15 days of the date on which the permission of Land and Development Officer, New Delhi, is communicated to the plaintiff by defendant No. 6. he balance amount of Rs. 55,000. 00 was payable at the time of registration of the sale deed before the Sub Registrar, Delhi/new Delhi. It is common case of the parties that a sum of Rs. 10,000. 00 was paid by plaintiff to defendants as recorded in agreement dated 19. 12. 1976. The further case of the plaintiff is that he approached defendant No. 6 and requested him to fix time and date for payment of Rs. l,65,000. 00 and for delivery of possession by defendants to the plaintiff but inspite of promising to do so defendant No. 6 has been putting of the plaintiff on one pretext or the other. Plaintiff also says that he approached defendant No. 6 personally at Jaipur and requested him to fix date and time for receiving payment and delivery of possession but defendant No. 6 failed to do so though he had promised that he will do it in the near future. Thereupon, plaintiff served a telegraphic notice through his advocate on defendant No. 6 calling upon him to receive sum of Rs. 1,65,000. 00 and deliver vacant possession of the property to him within three days next of the said telegram dated 4th May 1977 but the defendants failed to do so. Plaintiff had also served on defendants notice dated 6. 5. 77 calling upon defendants not to negotiate sale with anyone else and to deliver the vacant possession of the premises to the plaintiff against receipt of Rs. l,65,000. 00 within three days of the receipt of the said notice but the defendants failed to comply with the said notice. Plaintiff further claims that he contacted defendant No. 6 who promised to come to Delhi on 13. 5. 77 for the purpose and asked the plaintiff to get a bank draft prepared for Rs. l,65,000. 00 in the meanwhile which bank draft was got prepared by the plaintiff in favour of defendant No. 6 from Andhra Bank Ltd. but the said defendant again failed to turn up on 13. 5. 77. On being contacted again defendant No. 6 informed the plaintiff that he was not prepared to receive the amount and deliver possession to him. In plaint as originally filed the plaintiff stated that the cause of action for the remaining part of the agreement ie. for payment of Rs. 35,000. 00 on intimation of permission to sell by Land and Development Office and registration of the sale deed has not arisen as permission by Land and Development Office bad not so far been communicated by defendant No. 6 to him and stated that he reserves his right to claim specific performance of the remaining part of the agreement as and when such permissions are obtained. On 17. 5. 77 this suit was filed, inter-alia, praying for decree for vacant possession of the suit property subject to payment or deposit in court of Rs. l,65,000. 00 by the plaintiff.

( 2 ) A joint written statement dated 12. 8. 77 was filed by defendants. Various pleas were raised to which reference will be made in later part of the judgment. An application dated 23. 7. 79 (1. A. 2791/79) was filed by defendants seeking amendment of the written statement. The defendants s




























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