JUDGMENT

M.L. Mehta, J.

1. This appeal is directed against the judgment dated 20th October, 2009 of the learned Single Judge whereby the suit of the appellant/ plaintiff being CS (OS) No.2906/1995 was dismissed. Facts giving rise to filing of the suit are that vide an agreement to sell dated 26th November, 1999, the property bearing number E-1/13, Vasant Vihar, New Delhi (hereinafter referred to as "the suit property") was agreed to be sold by the defendant no.1 to plaintiff for a total sum of Rs.2.6 crore. It is alleged that because the suit property was also agreed to be sold by the defendant no.1 to defendant no.2 M/s Gupta Brothers and that the suit property was mortgaged with defendant No. 3, that these parties were also arrayed as defendants. However, subsequently, defendant no.2 was deleted from the array of defendants.

2. Plaintiff's case as set out was that the defendant no.1 had represented him that the suit property was subject to an equitable mortgage in favour of defendant no.3/Bank for an outstanding credit balance of Rs.90 lac and he had agreed to get the same released from the Bank and thereafter to execute the sale deed in his favour. As per the agreement to sell, two cheques of Rs.75 lac each respectively dated 26th November 1994 and 31st December, 1994 were given by plaintiff to this defendant at the time of execution of agreement on 26th November 1994. The balance sum of Rs.1.10 crore was to be payable at the time of registration of the sale deed. In terms of the aforesaid agreement, the obligations of this defendant were to obtain:

"1.Sale permission from DDA and Society, in terms of the perpetual sub leas deed.

2. Sale permission from the Competent Authority, of the Urban Land (Ceiling and Regulation 2976 Act of 1976), if applicable to the property.

3. Income Tax clearance Certificate on Form No. 34A under Section 23 of the Income Tax Act, 1961.

4. Permission from Appropriate Authority on Form No. 37(1) under Section 269-UC of the Income Tax Act, 1961."

3. It was averred that as agreed, this defendant was to inform the plaintiff by registered post about having taken above permissions and any other permission that may be required and within 30 days thereafter plaintiff was to pay balance amount for the execution of the sale deed by defendant no.1. It was agreed that if defendant no.1 failed to do so, plaintiff "would be entitled to get the sale deed registered through the court of law by specific performance of the contract/ agreement at the costs and expenses of vendor". On the other hand, if the plaintiff failed to make payment of the balance consideration within 30 days, after being so informed by defendant no.1, then he would be liable to pay interest @ 21 % on the balance amount for the delayed period. In Clause (5) of the agreement, it was stipulated that "however, in the event the vendee is desirous of taking possession of the property pending approval/permission, the vendee can do so by making the balance payment and vendor executing/registering all necessary documents, like GPA, Will, Supplementary agreement etc. as may be desired by the vendee's solicitor."

4. The preamble clause of the agreement stipulated the suit property to be subject to equitable mortgage in favour of defendant no.3 Bank for an amount of Rs.90 lac and defendant no.1 having agreed to get the same released from the mortgage before executing the sale deed. In Clause (7) of the agreement, defendant no.1 had assured plaintiff that the suit property was free from all encumbrances, except equitable mortgage in favour of defendant No. 3 Bank. In terms of the said clause, defendant No.1 had undertaken that he would be liable and responsible to make good the loss suffered by the plaintiff if there was any dispute or litigation or acquisition in respect of the suit property. In Clause (8), it was stipulated that pending completion of the sale, defendant no.1 would not enter into any agreement to sell in respect of the suit prop