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2017 Supreme(Mad) 665
IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
P.C. Eswaramoorthy - Appellant
Vs.
N. Palanisamy - Respondent
A.S.No.382 of 2010
Decided On : 12-04-2017
For the Appellant : Mr. K. Perumal.
For the Respondent: Mr. P. Mohankumar.
The burden of proof lies on the defendant to establish lack of consideration once the execution of the agreement is admitted. The court may consider the conduct of the parties and the time given for payment in deciding whether to grant specific performance.
Headnote:
specific performance - contract - Indian Evidence Act, 1872 - Section 91, Section 92 - [specific performance] - [contract] - [Indian Evidence Act, 1872 - Section 91, Section 92]
Fact of the Case:
The plaintiff filed a suit for specific performance of a property sale agreement. The defendant contended that the agreement was based on the plaintiff's promise to clear the defendant's debt to a third party.
Finding of the Court:
The court found that the agreement was supported by consideration as substantial amount was paid as advance. However, due to the conduct of the parties and the time given for payment, the court decided not to grant specific performance but directed the defendant to refund the advance amount with interest.
Issues: Enforcement of contract, existence of consideration, plaintiff's readiness to perform, entitlement to specific performance, relief entitled to
Ratio Decidendi: The court held that once the execution of the agreement is admitted, the burden is on the defendant to prove lack of consideration. The court also considered the conduct of the parties and the time given for payment in deciding not to grant specific performance.
Final Decision: The appeal was partly allowed, directing the defendant to refund the advance amount with interest and placing a charge over the property until the amount is fully realized by the plaintiff.
The unsuccessful plaintiff in O.S.No.338 of 2004, on the file of the learned I Additional District Judge, Coimbatore, is the appellant herein.
2. For the sake of convenience, the parties are referred to as per their ranking before the trial Court.
3. The plaintiff filed a suit in O.S.No.338 of 2004, before the learned I Additional District Judge, Coimbatore, for specific performance.
4. After contest, the suit was dismissed by the Trial Court, vide judgment and decree dated 28.2.2005 and hence this appeal.
5. The brief averments of the plaintiff are as follows:
The defendant, being the owner of the suit property, has entered into an agreement for sale of the property for a total consideration of Rs.5,10,000/- (Rupees five lakhs ten thousand only) and also executed registered agreement Deed dated 27.08.1999. On the date of agreement itself, the defendant has received a sum of Rs.4,85,000/-(Rupees four lakhs eighty five thousand) towards advance. The time fixed for execution of the Sale Deed is one year from the date of agreement. The defendant also handed over the Xerox Copy of the Sale Deed dated 04.02.1991 and agreed to hand over the original Sale Deed at the time of registration. From the date of agreement, the plaintiff is always ready and willing to perform his part of the contract. Inspite of several requests and demand made by the plaintiff, the defendant postponed the execution of Sale Deed in favour of the plaintiff. Hence the plaintiff issued a legal notice dated 16.12.1999. Besides, the plaintiff also issued paper publication dated 19.12.1999. But the defendant sent reply with false and untenable allegations. Hence, the plaintiff filed a suit for specific performance or in the alternative for return of advance amount.
6. The brief averments of the written statement filed by the defendant are as follows:
Resisting the claim of specific performance, it is the contention of the defendant that the plaintiff was running a finance company in the name of Sri Kariakaliamman Auto Finance and the defendant had financial transaction with him for more than six years and borrowed amount on various dates. He has also purchased a Mahindra van and hypothecated the same to the plaintiff on 21.07.1997. The defendant sold the Van for a sum of Rs.1,82,500/-(Rupees one lakh eighty two thousand five hundred only) to one Kandasamy on 30.06.1999 and paid a sum of Rs.1,80,000/-(Rupees one lakh eighty thousand only) to the plaintiff. The defendant is liable to pay a sum of Rs.1,50,000/-(Rupees one lakh fifty thousand only) to one Athammmal, wife of one Easwaran. To settle the above amount, there was a Panchayat in the presence of Nallasamy and as per the settlement arrived at in the Panchayat, the plaintiff agreed to discharge the defendant from his liability and to pay a sum of Rs.1,50,000/- to the said Easwaran if a sale agreement pertaining to the suit property is executed by the defendant. Believing the promise and assurance of the plaintiff, the defendant had executed the sale agreement in favour of the plaintiff without receiving any consideration. But, the plaintiff failed to pay the amount to the said Athammal. The legal notice and publication issued by the plaintiff are also properly replied by the defendant. Hence, the defendant prayed for dismissal of the suit.
7. Based on the above pleadings, the Trial court has framed the following issues.
1. Whether the suit transaction said to be taken place between the plaintiff and the defendant with regard to the suit property is true?
2. Whether suit agreement dated 27.08.1999 is supported by proper and valid consideration?
3. Whether the plaintiff has performed his part of the contract?
4. Whether the plaintiff is entitled to the relief of specific performance?
5. To what relief, if any, is the plaintiff entitled to?
8. On the side of the plaintiff, the plaintiff examined himself as PW1 and Exs.A1 to A6 were marked. On the side of the defendant, the defendant examined himself as DW1 and no doc
