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2013 Supreme(Mad) 916
High Court of Judicature at Madras
G. RAJASURIA, J.
Rajendran & Another
Versus
S.V. Natarajan & Others
S.A. No. 69 of 2013 & M.P. No. 1 of 2013
Decided On : 13-02-2013
For the Appellants:R.T. Doraisamy, Advocate.
Headnote:
Specific Performance - Agreement to Sell - Specific Relief Act - Section 16(c ) - 2010(10) SCC 512, 2011(1) SCC 429, 2011(6) CTC 112 - The court discussed the legal position that time is not the essence of the contract relating to immovable property and the requirement for the plaintiff to be ready and willing to perform the essential terms of the contract. The court emphasized the need for the plaintiff to demonstrate readiness and willingness to perform throughout the relevant points of time. The court also highlighted the impact of rising property prices on the principle that time is not of the essence of the contract, indicating that in the current economic scenario, the courts should apply greater scrutiny and strictness when considering the purchaser's readiness and willingness to perform the contract.
Fact of the Case:
The plaintiffs filed a suit seeking specific performance of an agreement to sell with an alternative prayer for a refund of the advance amount paid in respect of the suit immovable property. The trial court dismissed the suit on the ground that the plaintiffs were not ready and willing to perform their part of the contract, but directed the defendants to repay the advance amount with interest. The first appellate court confirmed the judgment and decree of the trial court.
Finding of the Court:
The court found that the plaintiffs failed to demonstrate their readiness and willingness to perform their part of the contract throughout the relevant points of time, as required by Section 16(c ) of the Specific Relief Act. The court also noted that the plaintiffs did not express their readiness and willingness to perform their part of the contract, and there was no perversity or illegality in the analysis of evidence by the lower courts.
Issues: The main issues were whether the plaintiffs were ready and willing to perform their part of the contract and whether the courts below correctly applied the law in the factual matrix of the case.
Ratio Decidendi: The court emphasized the requirement for the plaintiff to be ready and willing to perform the essential terms of the contract throughout the relevant points of time, as per Section 16(c ) of the Specific Relief Act. The court also highlighted the impact of rising property prices on the principle that time is not of the essence of the contract, indicating the need for greater scrutiny and strictness in assessing the purchaser's readiness and willingness to perform the contract.
Final Decision: The second appeal was dismissed, and there was no order as to costs.
1. This second appeal is focussed by the plaintiffs, inveighing the judgment and decree dated 23.04.2012 passed by the learned Subordinate Judge, Gobichettipalayam in A.S.No.5 of 2011 confirming the judgment and decree dated 06.01.2011 passed by the learned District Munsif, Gobichettipalayam in O.S.No.101 of 2008.
2. The parties, for the sake of convenience, are referred to here under according to their litigative status and ranking before the trial Court.
3. Heard the learned counsel for the appellant.
4. Niggard and bereft of details, the germane facts absolutely necessary for the disposal of this second appeal would run thus:
a. The appellants herein, being the plaintiffs, filed the suit seeking specific performance of an agreement to sell with alternative prayer for refund of the advance amount paid in respect of the suit immovable property. There emerged an agreement to sell between the plaintiffs and the defendants. The total sale consideration agreed was Rs.36,000/-, out of which, a sum of Rs.10,000/-was paid as advance by the defendants to the plaintiffs. Three months' time for performance was stipulated therein. However, within the said three months' time nothing transpired. Pre litigation notice was issued by the plaintiffs, on 27.02.2008 and thereafter the suit was filed.
b. The suit was resisted by the defendants on the main ground that the plaintiffs were not ready and willing to perform their part of the contract.
c. Whereupon issues were framed by the trial court.
d. Up went the trial, during which, on the plaintiffs' side P.Ws.1 and 2 were examined and Exs.A1 to A8 were marked. On the defendants' side, D1 examined himself as DW1 and no document was marked.
e. Ultimately, the trial court dismissed the suit on the main ground that the plaintiffs were not ready and willing to perform their part of the contract, however in the alternative directed the defendants to repay the advance amount of Rs.10,000/- with interest at the rate of 12% from the date of the agreement to sell till realisation, to the plaintiffs.
f. Being aggrieved by and dissatisfied with the same, the plaintiffs preferred appeal for nothing but to be dismissed by the first appellate court confirming the judgment and decree passed by the trial court.
g. Challenging and impugning the judgments and decrees of both the for a below, the plaintiffs have preferred this second appeal by suggesting the following substantial questions of law:
a] Whether the courts below are correct in dismissing the suit holding that the plaintiffs have not deposited the balance sale consideration on the date of filing the suit, hence they are not entitled to the relief without following the provisions under Section 16(c ) of the Specific Relief Act?
b] Whether the courts below are correct in holding that the plaintiffs are lethargic and not ready and willing to perform their part of the contract just because they are not depositing the balance amount on the date of filing the suit?
c] Whether the courts below, after having found that the defendants admitted the execution of sale agreement, receipt of advance amount and not cancelling the agreement on the expiry of 3 months period, are correct in dismissing the suit?
(extracted as such)
5. The learned counsel for the appellants/plaintiffs would pyramid his argument, which could succinctly and precisely be set out thus:
(i) Time is not the essence of the contract relating to immovable property. When such is the legal position, both the courts below unnecessarily stuck on to the theory as though within the three months' time, there was no payment of the remaining part of the sale consideration etc., by the plaintiffs.
(ii) There is also nothing to indicate that the defendants took any steps to rescind the contract on the alleged ground that the plaintiffs were not ready and willing to perform their part of the contract.
(iii) The plaintiffs' also to show their bona fides as per Section 16(c ) of the Spe
