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1991 Supreme(Mad) 328

High Court of Judicature at Madras
BELLIE
T. Periasamy Nadar, etc & Others
Versus
T.D. Ramasubramaniam
Appeal Suit Nos. 427 to 430 of 1981
Decided On :Decided on: 19-04-1991

Advocates Appeared:
K.T. Palpandian for Appellants.
V.S. Subramaniam for Respondent.

A contingent contract to do or not to do anything if an uncertain future event happens cannot be enforced by law unless and until that event has happened. If the event becomes impossible such contracts become void.

Headnote:

TAMIL NADU URBAN LAND (CEILING AND REGULATION) ACT, 1978 - SALE OF LAND - PERMISSION TO SELL - REJECTION OF APPLICATION - EFFECT - CONTRACT TO SELL - VOID - SPECIFIC PERFORMANCE - NOT ENFORCEABLE.

Fact of the Case:

The plaintiffs entered into four agreements with the defendant to purchase certain extent of land in the defendant's property. The agreements provided that the defendant shall furnish a draft sale deed for approval within a stipulated time and upon receipt of the sale deed, the defendant shall apply to the competent authority under the Tamil Nadu Urban Land (Ceiling and Regulation) Act, 1978, for permission to sell. The defendant applied for permission, but the application was rejected. The defendant sent a notice to the plaintiffs stating that since the application for permission to sell had been rejected, he was not in a position to execute the sale deed and therefore he repudiates the agreement. The plaintiffs filed suits for specific performance of the agreement and for direction to the defendant to apply afresh to the competent authority for permission with all correct particulars and to direct him to deliver vacant possession of the lands concerned in each of the suit.

Finding of the Court:

The court held that the agreements have become void and unenforceable due to the rejection of the application for permission to sell. The court further held that the agreements are not illegal and that the defendant is not liable to execute the sale deeds.

Issues: 1. Whether the agreements have become void and unenforceable due to the rejection of the application for permission to sell? 2. Whether the agreements are illegal?

Ratio Decidendi: 1. The court held that the agreements have become void and unenforceable due to the rejection of the application for permission to sell. The court relied on Section 32 of the Indian Contracts Act, which states that contingent contracts to do or not to do anything if an uncertain future event happens cannot be enforced by law unless and until that event has happened. If the event becomes impossible such contracts become void. 2. The court held that the agreements are not illegal. The court stated that the purpose of the agreement is to purchase or sell lands and that it is open to the plaintiffs to purchase lands as one block under one document or different plots under different documents. There is absolutely no merit in the argument that the plaintiffs really wanted to purchase the entire land in one block under one document but it is only with a view to escape the reach of the Act they have entered into four different agreements and therefore the agreements are illegal.

Final Decision: The court dismissed the appeals and confirmed the decree of dismissal of the suits by the trial court.

Judgment :-

1. In these four appeals the defendant is the same person. All the four appeals arise out of a common Judgment rendered by the trial court. The point that arises for consideration in the four appeals are similar. All the four appeals can be dealt with by a common Judgment.

2. These appeals A.S. Nos. 427 of 1981 to 430 of 1981 are respectively against the decree and Judgments in the suits O.S. Nos. 3811 of 3814 of 1978 on the file of the City Civil Court, Madras. O.S. No. 3311 of 1978 was filed by three brothers viz., T. Periasamy Nadar, T. Murugesan, and T. Thangaraj against T.D. Ramasubramaniam. The other three suits, namely O.S. Nos. 3812 to 3814 of 1978 were filed individually by the said three brothers against the same defendant, i.e. T.D. Ramasubramaniam respectively by T. Murugesan, T. Thangaraj and T. Periasamy. All the four suits were dismissed and therefore, these appeals are filed by the plaintiffs.

3. The questions involved in all the four suits are almost similar. The defendant is the owner of the property bearing Door No. 15/8, Sir Thiagaraya Road, Pondy Bazaar, Madras. In respect of this property, on 10.8.1977 he entered into four agreements of sale, one with the three brothers T. Periasamy, T. Murugesan, and T. Thangaraj, another with T. Murugesan, third with T. Thangaraj and four with T. Periasamy. In all these agreements he agreed to sell certain extent of land in the above mentioned property to the respective persons. The extent and sale consideration of the land to be sold vary in the four agreements. Already on 31.1.1977 an advance of Rs. 2,500/- had been paid and on the date of agreement another sum of Rs. 13,500 was paid. Thus in all an advance of Rs. 16,000/- has been paid. In each of the agreement, it was provided that the defendant shall furnish a draft sale deed for approval within a stipulated time, which differ from agreement to agreement and upon such receipt of the sale deed, the defendant within one month therefrom shall apply to the competent authority under the Tamil Nadu Urban Land (Ceiling and Regulation) Act, 1978, for permission to sell and then within one month from the grant of such Eermission, the sales shall be completed. The balance of sale consideration shall be paid at the time of registration of the sale deed. The defendant received the draft sale deeds, and on 3.10.1977 he applied to the competent authority for permission. On 4.10.1977 the plaintiffs sent a notice to the defendant stating that his applications for permission did not contain the necessary particulars and called Upon him to do the needful. The defendant made some corrections in the application, but the competent authority rejected the application on l8.10.1977. On 19.10.1977 the defendant sent a notice to the plaintiff stating that since the application for permission to sell had been rejected by the competent authority, he was not in a position to execute the sale deed and therefore he repudiates the agreement. He has sent a cheque for Rs. 16,000/- in respect of each of the agreements to the plaintiffs in repayment of the advance amount paid to him. The plaintiffs have kept the cheque uncased. In these circumstances, the plaintiffs have filed these suits.

The case of the plaintiffs is that there is an implied term in the contract that the defendant shall do all things necessary for obtaining sanction from the competent authority, but he failed to do so. Whereas he should have stated in the relevant column in the application the date of construction of the building, he has only stated Vacant land inspite of request by the plaintiffs. Further he failed to give a statement required under S. (1) of the Tamil Nadu Urban Land (Ceiling and Regulation) Act 1978. For these reasons the permission was rejected. The defendant failed to comply with the requirements as regards the particulars deliberately. The plaintiffs therefore called upon the defendant to appeal against the order of rejection, but he would not do. T














































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