MADRAS HIGH COURT
M.Duraiswamy, J.
Palaniammal & Others - Appellants in A.S.No.46/2006
M.Ravi Shankar & Another - Appellants in A.S.No.91/2006
Versus.
K.R.C. Anbalagan & Others - Respondents
A.S Nos.46 and 91 of 2006 & C.M.P.No.871 of 2012
Decided On : February 18, 2012
Specific Performance - Sale Agreement - Registration Act - Summary
Fact of the Case:
The plaintiffs filed a suit for specific performance and permanent injunction based on an unregistered sale agreement and assignment deed. The defendants contested the claim, stating that the agreements were for a loan and were not valid. The trial court decreed the suit, but the defendants appealed.
Finding of the Court:
The court found that the unregistered agreements could not be relied upon for specific performance. It also found that the plaintiffs failed to prove their readiness and willingness to perform the contract. The court set aside the decree for specific performance and permanent injunction, dismissing the suit.
Issues: Validity of unregistered agreements, plaintiffs' readiness and willingness to perform the contract
Ratio Decidendi: Unregistered agreements cannot be relied upon for specific performance. Plaintiffs must prove their readiness and willingness to perform the contract.
Final Decision: The trial court's decree for specific performance and permanent injunction was set aside, and the suit was dismissed. The appeals were allowed, and there was no order as to costs.
Both the appeals arise against the judgment and decree passed in O.S.No.33 of 2004 on the file of Principal District Court, Krishnagiri at Dharmapuri.
2. The first defendant in the suit has filed the appeal in A.S.No.46 of 2006. However, the defendants 2 and 3, who were originally respondents 2 and 3 in the appeal were transposed as appellants 2 and 3, therefore, A.S.No.46 of 2006 has been filed by the defendants 1 to 3 and the respondents 1 and 2 were the plaintiffs.
3. In A.S.No.91 of 2006, the defendants 2 and 3 are the appellants, respondents 1 and 2 were the plaintiffs and the 3rd respondent was the 1st defendant in the suit.
4. The plaintiffs filed the suit in O.S.No.33 of 2004 for specific performance and for permanent injunction.
5. The brief case of the plaintiffs are as follows:-
(i) According to the plaintiffs, the suit properties belonged to the 1st defendant. The 1st defendant entered into an agreement of sale with the 2nd plaintiff on 27.4.2002 to sell the suit property for a sum of Rs.6,90,000/-. On the date of execution of the agreement, the 2nd plaintiff paid an advance of Rs.50,000/- to the 1st defendant. The 2nd plaintiff also paid a further advance of Rs.1,50,000/- to the 1st defendant on 29.04.2002. The 1st defendant had also endorsed the said payment and also the delivery of possession of the suit property in the agreement. The possession was handed over to the 2nd plaintiff on 29.4.2002.
(ii) According to the plaintiffs, since the 2nd plaintiff, who is a hardware merchant, wanted business capital urgently, he agreed to assign his rights under the sale agreement dated 27.4.2002 to the 1st plaintiff by receiving the advance amount of Rs.2,00,000/-. Therefore, on 3.6.2002, the 2nd plaintiff executed a deed of assignment in favour of the 1st plaintiff after receiving the said sum of Rs.2,00,000/- from him. The 2nd plaintiff also delivered possession of the property to the 1st plaintiff on 3.6.2002 and the original sale agreement dated 27.4.2002 was delivered to the 1st plaintiff along with the assignment deed dated 3.6.2002. Time for performance of the contract was fixed as five months from the date of sale agreement dated 27.4.2002. The 1st plaintiff was and has been ready and willing to perform his part of the contract.
(iii) According to the plaintiffs, on 16.6.2002, the 1st plaintiff, through J.P.Periasamy and Narayanan of Krishnagiri sent a xerox copy of the assignment deed to the 1st defendant and requested her to receive the balance sale consideration of Rs.4,90,000/- from him and execute the sale deed in his favour. But the 1st defendant refused to perform her part of the contract and sent a legal notice dated 21.6.2002 to the 2nd plaintiff with false allegations stating that the transactions covered under the sale agreement dated 27.4.2002 is only a loan transactions between the 1st defendant and the 2nd plaintiff. On 23.7.2002, the 2nd plaintiff issued reply to the 1st defendant and thereafter, on 12.8.2002 the 1st defendant sent a rejoinder to the second plaintiff's counsel stating that the assignment deed is invalid and also asserted that she is in possession of the suit property.
(iv) According to the plaintiffs, the 1st plaintiff has been and is always ready and willing to perform his part of the contract. On 4.9.2002, the 1st plaintiff issued a legal notice to the 1st defendant by registered post, calling upon her to receive the balance of sale consideration and execute the sale deed. The said postal cover was returned with an endorsement stating that there was no such addressee. The said notice sent by courier was also refused by the 1st defendant.
(v) According to the plaintiffs, the 1st defendant appears to have created false documents purporting to be an unregistered sale agreement and a power of attorney deed, in the name of the 2nd defendant, who is an Advocate. The 2nd defendant, based on those documents, filed a suit in O.S.No.235 of 2002 on the file of District Munsif Court, Krishnagir
Jugraj v. P. Sankaran and others 2010(3) CTC 297 ;
Motilal Jain v. Ramdasi Devi and others 2006 SCC 420 ();
Shyam Singh Daryasingh (dead by LRs and others 2004-3-L. W. 151 ; 2003 (12) SCC 160 ;
Habiba Khatoon v. Ubadul Huq and others 1997-3-L. W. 572 ; 1997(7) SCC 452 ;
Ram Niwas (dead through LRs Bano and others 2001-1-L. W. 859 ; 2000 (6) SCC 685 ;
Mohideen Sahib v. A. Amea Bi and others 2007(1) CTC 505 ;
Krishna Swarup Bhatnagar v. Chander Mohan Rewal and another AIR 2000 HP 53 ; and
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