IN THE HIGH COURT OF JUDICATURE AT MADRAS
R. MALA, J.
S. Udayasankar - Appellant
Vs.
R. Kothandapani & Ors. - Respondents
Appeal Suit No.968 of 2004
Decided On : 21.07.2015
Specific Performance - Sale Agreement - Time is Essence of Contract - 1. Indian Contract Act, 1872 - Section 16(c) - 2. Specific Relief Act, 1963 - Section 16(c) - 3. Limitation Act, 1963 - Article 54
Fact of the Case:
The plaintiff filed a suit for specific performance of a sale agreement, claiming that the defendants failed to execute the sale deed within the agreed time. The defendants contended that the plaintiff did not comply with the conditions of the agreement and the suit was barred by limitation.
Finding of the Court:
The court found that time was the essence of the contract, as evidenced by the repeated extensions of the payment period. The court also held that the suit was barred by limitation, as it was filed after the prescribed period from the extended time for performance.
Issues: 1. Whether time is the essence of the contract? 2. Whether the suit is barred by time? 3. Whether the plaintiff complied with the conditions of the agreement? 4. Whether the plaintiff is entitled to specific performance?
Ratio Decidendi: The court held that time was the essence of the contract based on the repeated extensions of the payment period. It also found that the suit was barred by limitation as it was filed after the prescribed period from the extended time for performance. The plaintiff's failure to comply with the conditions of the agreement led to the court's decision that the plaintiff was not entitled to specific performance.
Final Decision: The court set aside the decree and judgment of the trial court, ruling that the plaintiff was only entitled to a refund of the amount paid with interest, and not to specific performance. The appeal was partly allowed, and the plaintiff was awarded the refund with interest at the rate of 6% per annum.
This Appeal Suit arises out of the judgment and decree dated 30.09.2003 made in O.S.No.76 of 1997 on the file of the Additional Sub-Court, Gobichettipalayam.
2. The averments made in the plaint are as follows:
(i) On 29.01.1990, the defendants entered into a sale agreement with the plaintiff and agreed to sell the property at Rs.7,50,000/- per acre. The time for performance of the contract was fixed as 1 year. The plaintiff has paid Rs.50,000/- as an advance and subsequently, he paid some amounts which was endorsed on the agreement itself.
(ii) The first defendant admitted the total advance amount paid and received as Rs.5,95,000/-. The plaintiff is always ready and willing to perform his part of contract. Since the defendants are postponing the execution of sale deed, the plaintiff issued telegram on 22.07.1996. Later he came to know that on 28.06.1993, the first defendant sold specific acres 0.33 out of 1.50 acres, which was agreed to be sold to plaintiff, to one Balasubramanian. At present, only 1.17 acres is available for sale. Since the defendants are not ready and willing to perform their part of contract, the plaintiff filed the suit for a direction to the first defendant to execute the sale deed covering suit property in favour of the plaintiff on receipt of sum of Rs.2,82,500/- and to pay the costs of the suit or in the alternative, to direct the first defendant to pay the plaintiff a sum of Rs.5,95,000/- with future interest and costs. Therefore, he prayed for decree.
3. The gist and essence of the written statement filed by the 1st defendant, which is adopted by the defendants 2 to 4, are as follows:-
(i) The defendants admitted the execution of the agreement dated 29.01.1990 and also admit the receipt of a total sum of Rs.3,30,000/-. The signature under the endorsement dated 27.07.1993 is forged one. The land covered by the agreement was never delivered to the plaintiff and the defendants are in possession and enjoyment of the same. The plaintiff himself helped the defendants to dispose of the suit property so that he could get back his advance amount. Under such circumstances, the first defendant sold 0.33 acres out of 1.50 acres to one Balasubramanian on 28.06.1993.
(ii) This defendant also expressed his readiness to return Rs.3,30,000/- to the plaintiff, when the suit agreement was cancelled by the plaintiff in May 1993. A Panchayat was convened and this defendant paid Rs.2,50,000/- to the plaintiff. The plaintiff has no right to split the agreement and seek specific performance in respect of 1.17 acres only, since total extent is 1.50 acres. He ought to have impleaded vendee Balasubramanian. Therefore, they prayed for dismissal of the suit.
4. The trial Court, after considering the averments both in the plaint and the written statement and arguments of both the counsel, has framed three issues and considering the oral evidence of P.W.1, P.W.2, D.W.1 and D.W.2 and documentary evidence of Exs.A1 to A15 and B1 to B6, decreed the suit as prayed for in the plaint, against which, 1st defendant/appellant has preferred this appeal.
5. After hearing the arguments of both sides counsel, the following points for consideration are framed:
1. Whether the time is essence of contract?
2. Whether the suit is barred by time?
3. Whether the plaintiff is not entitled to decree of specific performance since he has not complied with the conditions imposed in Ex.A1 sale agreement?
4. Whether the trial Court is right in granting decree of specific performance to the plaintiff?
5. To what relief, the appellant/1st defendant is entitled to?
6. Learned counsel for the appellant submits that as per Ex.A1 sale agreement, total extent is 1.50 acres, but the plaintiff/first respondent has filed the suit only in respect of 1.17 acres, which is not maintainable. He further submits that the plaintiff/first respondent was well aware of the fact that one Balasubramanian has purchased 0.33 acres out of 1.50 acres, but he failed to implead him as party
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