The importance of time as the essence of the contract and the readiness and willingness of the parties to perform their respective parts of the contract.

Shiv Narayan Dhingra, J.- This suit has been filed by the Plaintiff for Specific Performance of an Agreement to Sell dated 2nd August, 1988 executed between the parties whereby Defendants had agreed to sell and transfer by way of a Conveyance Deed all their rights, title and interest in the leasehold plot of land measuring 0.97 acre, known as Bungalow No.8, Tolstoy Marg, New Delhi to the Plaintiff for a total sale consideration of Rs. 3,50,00,000/- (Rs. Three Crore Fifty Lac only). Out of the total agreed amount of Rs. 3.5 crore, a sum of Rs. 42 lac was paid by the Plaintiff to the Defendants as earnest money and remaining amount of Rs. 3,08,00,000/was to be paid in terms of the Agreement. On payment of total consideration, the Defendants were to execute Conveyance Deed of the property in favour of the Plaintiff and were to hand over vacant physical possession of part of the premises, in occupation of the Defendants and the symbolic possession of part of the property in occupation of the five tenants. Under the Agreement to Sell dated 2nd August, 1988, the Defendants were required to do the following acts, before being entitled to receive balance consideration and to execute Conveyance Deed:

1. To secure mutation in their favour in respect of the property in the books and records of the Land and Development Office.

2. To make application to the Competent Authority under Section 27 of Urban Land (Ceiling and Regulation) Act, for permission to convey the property to the Purchaser. The Purchaser was to join in the application for the said permission, if so required, and permission, if any, required under Urban Land (Ceiling and Regulation) Act was to be obtained by the Defendants.

3. To obtain No Objection Certificate under Section 269(UC) of Chapter XXC of the Income Tax Act, 1961.

4. To obtain Income Tax Clearances under Section 230(A) of the Income Tax Act.

2. After obtaining the abovementioned clearances/NOC and mutation, VENDORS (Defendants) were to intimate to the VENDEE (Plaintiff) by registered post that aforesaid clearances had been obtained and there was no impediment in execution and registration of the Conveyance Deed. The purchaser (Plaintiff) was to accept the execution of the requisite Conveyance Deed against receipt of vacant physical possession of part of the property and symbolic possession of rest of the property on payment of the balance amount within 90 days of the issue of the registered letter intimating the obtaining of clearances referred to in preceding paras (Clause 8 of the Agreement). It was specifically provided that in case Plaintiff failed to perform its part of the contract on receipt of the said intimation, he would be guilty of breach of contract. It was also provided that time shall be essence of the contract.

3. It was specifically provided that in case the Plaintiff failed to make payment and accept the Conveyance Deed, the earnest money already paid shall be forfeited. It was also provided that Defendants would be liable to pay all charges, taxes, cesses in respect of the property upto the date of execution of Conveyance Deed and thereafter the liability would be that of the Plaintiff.

4. It is submitted by the Plaintiff that the Plaintiff was ready and willing to perform its part of the contract but Defendants despite request and reminders failed to perform their part of the contract and instead vide letter dated 16th March, 1992 informed the Plaintiff that earnest money stood forfeited and Defendants would be free to deal with the property in any manner they like. The response to the letter dated 16th March, 1992, was given by Plaintiffs Advocate vide letter dated 8th April, 1992 refuting all averments. The Defendants did not respond to this letter giving impression that they acceded to the averments and assertions made by the Plaintiff in its letter. The acts and conduct of the Defendants gave rise to the apprehension in the mind of the Plaintiff that Defendants were not going to perfor