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2014 Supreme(Mad) 1797
High Court of Judicature at Madras
P.R. SHIVAKUMAR, J.
R. Karuppusamy
Versus
P. Sivaraj
A.S. No. 192 of 2009
Decided on: 03-07-2014
Advocate Appeared:
For the Appellant:L. Mouli, Advocate.
For the Respondent:M. Prabhakar, Advocate.
A suit for specific performance without seeking a declaration that the cancellation of the agreement was bad in law is maintainable.
Headnote:
SPECIFIC PERFORMANCE - SALE AGREEMENT - UNAPPROVED LAYOUT - CONSTRUCTION OF SHED - REGISTRATION OF SALE DEED - PUBLIC POLICY - READINESS AND WILLINGNESS - DESCRIPTION OF PROPERTY - DISCRETION OF COURT.
Fact of the Case:
The suit was filed by the respondent for specific performance based on the agreement for sale dated 11.06.2006, which was produced by the respondent before the trial court and marked as Ex.A1. The appellant contended that the suit is not maintainable for want of prayer seeking a declaration that the cancellation of the agreement by the appellant/defendant is bad in law and that the suit agreement for sale is opposed to public policy and hence the suit sale agreement is not capable of being specifically enforced.
Finding of the Court:
The court held that the suit for specific performance without seeking a declaration that the cancellation of the agreement was bad in law is maintainable. The court also held that the agreement for sale is not opposed to public policy and that the respondent/plaintiff had proved his readiness and willingness to perform his part of the obligations under the agreement for sale.
Issues: 1. Whether the suit for specific performance is not maintainable without a prayer for declaration that in unilateral cancellation by the defendant is invalid? 2. Whether the suit agreement for sale is opposed to public policy so as to disentitle the respondent/plaintiff to seek the relief of specific performance? 3. Whether the respondent/plaintiff has proved his readiness and willingness to perform his part of the obligations under the suit agreement for sale? 4. Whether the description of the property found in the plaint schedule is incorrect? 5. Whether the respondent/plaintiff is entitled to the relief of specific performance?
Ratio Decidendi: 1. A suit for specific performance without seeking a declaration that the cancellation of the agreement was bad in law is maintainable. 2. An agreement for sale is not opposed to public policy merely because it contains a clause requiring the vendor to construct a shed on the property and get it assessed to house tax in order to facilitate the registration of the sale deed. 3. The respondent/plaintiff had proved his readiness and willingness to perform his part of the obligations under the agreement for sale by specifically pleading his readiness and willingness and by returning the cheque sent by the appellant/defendant along with his notice dated 22.11.2006.
Final Decision: The appeal suit is allowed in part. The decree of the trial court dated 24.09.2008 made in O.S.No.53 of 2007 is set aside. The suit in O.S.No.53 of 2007 is remitted back to the trial court, namely the Additional District and Sessions Judge (Fast Track Court No.1), Coimbatore with a direction to render a specific finding as to what should be done with the shed after giving an opportunity to the parties to furnish the measurement and the value of the shed available in the suit site and if necessary, after allowing them to lead evidence and then pass a full-fledged decree according to such finding. No cost.
Certainly. Here are the key points derived from the provided legal document:
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A suit for specific performance of a sale agreement is maintainable even without a prayer for a declaration that the cancellation of the agreement was bad in law (!) .
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An agreement for sale is not opposed to public policy solely because it includes a clause requiring the vendor to construct a shed and get it assessed for taxes, provided that such clauses are intended to facilitate registration and are not fraudulent or intended to mislead authorities (!) (!) .
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The readiness and willingness of the purchaser to perform their obligations must be established and can be demonstrated by specific pleadings and conduct, such as returning cheques or expressing willingness to complete the transaction (!) (!) .
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The description of the property in the agreement, including measurements and boundaries, should be accurate and not misleading; discrepancies or ambiguities can affect the enforceability of the agreement (!) .
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The time stipulated for performance in an agreement may not necessarily be deemed an essential condition unless explicitly specified or proven to be so; failure to perform within the stipulated time does not automatically render the agreement unenforceable if the other party has not defaulted (!) (!) .
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The unilateral cancellation of an agreement by one party does not bar the other party from seeking specific performance without first seeking a declaration that the cancellation was illegal or opposed to law, as the law permits remedies for breach without such declarations (!) (!) .
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The existence of a government order declaring certain conveyances opposed to public policy is subject to conditions, such as obtaining necessary certificates or certificates of no objection; agreements that incorporate clauses to circumvent such restrictions are not necessarily opposed to public policy if proper procedures are followed (!) (!) .
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The inclusion of clauses requiring the vendor to put up a shed and get it assessed was primarily to facilitate registration under applicable laws and was not inherently opposed to public policy, especially if the agreement and subsequent actions comply with legal requirements (!) .
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The failure of the vendor to perform obligations such as constructing a shed or obtaining tax assessments within the stipulated time, followed by unilateral termination notices, does not prevent the purchaser from claiming specific performance if the purchaser was ready and willing to perform (!) (!) .
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The court may remand the case for a specific finding regarding the status and treatment of any structures (e.g., sheds) on the property, especially when the agreement includes such provisions but the court's decree lacks clarity on this aspect (!) .
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The court emphasizes that the legal remedies for breach of contract, including specific performance, do not require prior declarations of illegality or bad faith, and that procedural or formal clauses in agreements should not prevent equitable relief if the substantive requirements are met (!) .
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The revocation or modification of government orders affecting conveyance laws can influence the enforceability of agreements, but compliance with procedural requirements and legal formalities is crucial in determining validity and enforceability (!) .
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The court's discretion in granting specific performance is guided by principles of fairness, the conduct of the parties, and the substantive merits of the case, rather than rigid adherence to procedural formalities or technical objections (!) .
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The court may issue directions for further evidence or measurements, especially regarding structures like sheds, and may remand the case for a full-fledged decree after such findings are made (!) .
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The law recognizes that a party seeking specific performance need not always seek a declaration of illegality or bad faith; such declarations are not a precondition for obtaining equitable relief, provided the fundamental criteria are satisfied (!) .
Please let me know if you need further elaboration or assistance.
1. This appeal has been filed against the decree of the trial court dated 24.09.2008 passed by the learned Additional District and Sessions Judge, Fast Track Court No.I, Coimbatore in O.S.No.53 of 2007. The defendant in the said suit is the appellant herein. The plaintiff/decree holder is the respondent in this appeal. The suit was filed for the relief of specific performance based on an agreement for sale dated 11.06.2006. By the said decree, the learned trial Judge granted the relief of specific performance directing the appellant herein/defendant to execute a sale deed after receiving the balance amount of sale consideration in accordance with the terms of the suit sale agreement. Aggrieved by and challenging the said decree of the trial Court granting the relief of specific performance, the present appeal has been filed on various grounds set out in the memorandum of grounds of appeal.
2. The respondent herein/plaintiff filed the above said suit for the relief of specific performance based on the averments made in the plaint, which are in brief, as follows:
i) On 11.06.2006, the appellant herein/defendant entered into an agreement with the respondent herein/plaintiff to sell his property, namely the suit property to the respondent/plaintiff at Rs.62,500/- per cent and received an advance of Rs.50,000/-. The agreement was reduced to writing and the same was signed by the parties on the same day. The property which was agreed to be sold measures an extent of 14 cents and 32 sq.ft and the total consideration comes to Rs.8,79,587/-. As the said land was a vacant land in an unapproved lay out and it was sought to be purchased for his use as a house site, the parties agreed for a condition that the appellant/defendant should put up a shed in the said property at his costs, get the same assessed to house tax and furnish the house tax receipt, so that there would not be any impediment for the registration of the sale deed conveying the suit property as a house site.
ii) Though the appellant/defendant had put up a shed in accordance with the agreed terms, he was keeping on informing the respondent/plaintiff that the same was not assessed to tax. Believing the words of the appellant/defendant, the respondent/plaintiff was waiting for the appellant/defendant to come with those documents and all along the respondent/plaintiff was ready and willing to perform his part of the contract under the suit agreement for sale. However, to the shock and surprise of the respondent/plaintiff, all of a sudden the appellant/defendant issued a notice to the respondent/plaintiff on 22.11.2006 enclosing a cheque for Rs.50,000/-stating that the suit sale agreement was cancelled and he was returning the advance amount received from the respondent/plaintiff. On receipt of the said notice, the respondent/plaintiff issued a reply informing the appellant/defendant that he was always ready and willing to perform his part of the contract and calling upon the appellant/defendant to come and execute the sale deed in accordance with the terms of the agreement. In the reply notice it was further informed that in view of the attempt made by the appellant/plaintiff to wriggle out of the transaction, the respondent/plaintiff would be forced to approach the court for appropriate reliefs. As the appellant/defendant did not come forward to arrange for the execution of the sale deed even thereafter, the respondent/plaintiff was constrained to file the suit for specific performance.
3. Based on the above said pleadings, the respondent/plaintiff had prayed for a decree directing the appellant/defendant to specifically perform his part of the agreement and to do all acts necessary to convey the suit property to the respondent/plaintiff.
4. The suit was resisted by the appellant/defendant based on the averments made in his written statement, which are in brief, as follows:
i) The execution of suit sale agreement dated 11.06.2006 agreeing to sell the suit land at the
