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2015 Supreme(Mad) 1413

HIGH COURT OF JUDICATURE AT MADRAS
P.R. SHIVAKUMAR, J.

D.K. Ganesan – Appellant
Versus
Arumugham – Respondent
A.S. No. 569 of 2009
Decided On : 23-03-2015

Advocates:
Advocate Appeared:
For the Appellants:C. Deivasigamani, Advocate
For the Respondents:P. Saravana Sowmiyan, Advocate

The burden of proof lies with the party claiming the agreement was not intended as an agreement for sale. The party seeking specific performance must prove readiness and willingness to perform.

Headnote:

specific performance - agreement for sale - Specific Relief Act, 1963 - Section 16(c)

Fact of the Case:

The respondent/plaintiff sought specific performance based on an agreement for sale dated 18.01.2006 executed by the appellant/defendant. The appellant/defendant resisted the suit, claiming the agreement was intended as security for a loan.

Finding of the Court:

The trial court found the agreement to be true and held that the appellant/defendant failed to prove it was executed as security for a loan. The court also found the respondent/plaintiff proved readiness and willingness to perform his part of the agreement.

Issues: 1. Validity of the sale agreement 2. Plaintiff's readiness and willingness to perform 3. Entitlement to specific performance

Ratio Decidendi: The burden of proving the agreement was not intended as an agreement for sale was heavily upon the appellant/defendant. The court found the appellant/defendant failed to discharge this burden. The respondent/plaintiff's evidence of readiness and willingness was accepted.

Final Decision: The trial court's decree granting specific performance was confirmed, and the appeal was dismissed.

JUDGMENT:-

1. As against the decree dated 30.12.2008, made in O.S.No.187 of 2007 on the file of the Additional District Judge (Fast Track Court I), Coimbatore granting the relief of specific performance, the defendant in the said suit has filed the present appeal.

2. The above said suit was filed by the respondent herein/plaintiff seeking the relief of specific performance based on an agreement for sale dated 18.01.2006 executed by the appellant herein/defendant. The plaint allegations, in brief, are as follows:

(i) The appellant herein/defendant, claiming to be the absolute owner of the property described in the plaint schedule as he had got it under a Will of one Arthanari dated 15.11.1985 and also as per the decree passed in O.S.No.1223/1990, agreed to sell the suit property to the respondent /plaintiff for a sum of Rs.10,00,000/- and the respondent/plaintiff agreed to purchase the same for the above said price. Accordingly, both of them entered into a written agreement for sale on 18.01.2006 with specific terms and conditions. A sum of Rs.1,50,000/- was paid as advance by the respondent/plaintiff to the appellant/defendant on the date of agreement for sale. Thereafter, the respondent/plaintiff made additional payments to the tune of Rs.5,00,000/- towards the balance sale consideration, leaving a sum of Rs.3,50,000/- alone as the balance amount due towards the sale price. The details of payments including the advance paid on the date of agreement are as follows:      

S.No.

Date

Amount

1

18.01.2006

Rs. 1,50,000.00

2

18.05.2006

Rs.1,70,000.00

3

21.09.2006

Rs. 70,000.00

4

02.11.2006

Rs. 10,000.00

5

27.12.2006

Rs.1,50,000.00

6

31.12.2006

Rs.1,00,000.00

Total

Rs.6,50,000.00

(ii) Even though the respondent/plaintiff, on the date of making the last payment, namely 31.12.2006, requested the appellant/defendant to receive the entire balance amount of sale consideration and execute the sale deed, the appellant/defendant promised to execute the sale deed in the first week of January 2007. However, he put the respondent/plaintiff in possession of the suit property and thereafter, the respondent/plaintiff has been in possession and enjoyment of the same. Since the time for completion of sale transaction had been fixed as one year, the respondent/plaintiff met the appellant/defendant before 18.01.2007 with the balance sale consideration, but the appellant/defendant sought time till the end of January 2007 on the premise that he had to get the parent document from the Sub-Registrar's office and assured that he would execute the sale deed not later than the first week of February 2007.

(iii) Thereafter, when the respondent/plaintiff tried to meet the appellant/defendant at his residence, the latter avoided the meeting. Sensing that the appellant/defendant was avoiding performance of his obligations under the contract for sale, the respondent/plaintiff issued a legal notice dated 14.02.2007 by Registered Post. However in the address on the envelope, the initial was mistakenly noted as 'T' instead of 'D'. Taking advantage of the same, the appellant/defendant tried to avoid the service of the said notice. Hence, another notice dated 26.02.2007 with correct initial of the appellant/defendant was sent and the receipt of the same was acknowledged by him on 13.03.2007. The balance amount of sale consideration, which was in the hands of the respondent/plaintiff, was deposited with the Primary Agricultural Corporative Bank Limited on 22.03.2007 in Fixed Deposit for one year. However, the same was capable of being withdrawn at any time before the date of maturity. The respondent/plaintiff undertook to deposit the balance price in Court if the Court would direct him to do so. The respondent/plaintiff was ever ready and willing to perform his part of the contract. As the appellant/defend



















































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