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IN THE HIGH COURT OF JUDICATURE AT MADRAS
S.M.Subramaniam, J.
Sivasankaran - Appellant
Vs.
Saravanan - Respondent
AS No.192 of 2022 And CMP Nos.7938 and 7039 of 2022
Decided On : 15-02-2023
Suit property for a sale consideration - Appeal Suit - Appellant is defendant and respondents are plaintiffs in suit - Plaint averments reveal that defendant is owner of the suit property - Defendant offered to sell suit property for a sale consideration of and received a sum as advance and registered an Agreement in favour of plaintiffs on file of Joint I Sub Registrar Office vide document - Held, In view of fact that Issue Nos.1 and 2 have now been decided in favour of defendant, plaintiffs are not entitled for relief of specific performance - However, plaintiffs are entitled for refund of advance amount as per suit Sale Agreement Ex.A-1 document - It is not in dispute between parties that defendant received sum from plaintiffs and said amount is to be refunded by defendant to plaintiffs along with interest at rate of 6% per annum - Thus the plaintiffs are entitled for alternate relief of refund of advance amount of Rs.20 lakhs along with interest at rate of 6% per annum from the date of suit Sale Agreement Ex.A-1 document till date of realisation - Till such time, advance amount of Rs.20 lakhs along with interest has been settled in favour of plaintiffs, plaintiffs are directed not to alienate the suit schedule property - Appeal Suit is allowed in part.
JUDGMENT :
The present Appeal Suit has been instituted against the judgment and decree dated 04.01.2022 passed by the Special Court for Trial Cases under SC/ST (PoA)-cum-Principal District Judge at Cuddalore in OS No.74 of 2019.
2. The appellant is the defendant and the respondents are plaintiffs in the suit.
3. The respondents herein instituted the suit for specific performance based on the Sale Agreement dated 20.09.2018.
4. The plaint averments reveal that the defendant is the owner of the suit property. The defendant offered to sell the suit property for a sale consideration of Rs.21 lakhs and received a sum of Rs.20 lakhs on 20.09.2018 as advance and registered an Agreement in favour of the plaintiffs on the file of the Joint I Sub Registrar Office vide document No.2899 of 2018.
5. As per the terms of the Agreement, the period to perform the contract was six months i.e., from 20.09.2018 to 19.03.2019. If the plaintiffs fail to pay the balance amount of Rs.1 lakh within six months and register the Sale Deed, they have to loose the advance amount of Rs.20 lakhs. If the defendant fails to execute the Sale Deed within the time limit stipulated, the plaintiffs are at liberty to file a suit for specific performance of contract and deposit the balance amount in the Court.
6. At the time of execution of the Sale Agreement, the defendant has deposited the original parent deed to the plaintiffs. The plaintiffs state that they were ready and willing to perform their part of contract by paying the balance amount of Rs.1 lakh and get the Sale Deed executed, but the defendant did not execute the Sale Deed with an ulterior motive. The plaintiffs made several demands, which were went in vain and subsequently issue a legal notice through the defendant's counsel on 16.03.2019.
7. The defendant denied the plaint averments through his written statement. The defendant states that he executed the registered Sale Agreement on 20.09.2018 in favour of the plaintiffs. The defendant received money from the plaintiffs only for interest. For the said loan amount, the defendant executed the Sale Agreement as security in favour of the plaintiffs.
8. The defendant paid interest every month to the plaintiffs and also settled the principal amount in the month of February 2019 before the Panchayatars. Despite the fact that the plaintiffs received the said principal amount and interest, but they failed to cancel the registered Sale Agreement.
9. The defendant states that the first witness in the Sale Agreement Mr.Periyasamy, who is the father of the second plaintiff Mr.Rathinasamy and the second witness Mr.Mariappan in the Sale Agreement is the friend of the second plaintiff Mr.Rathinasamy.
10. In the year 2017, the plaintiffs and the defendant executed the registered Sale Agreement for an amount of Rs.20 lakhs vide document No.480 of 2017 and the same has been cancelled on 20.03.2018 vide document No.798 of 2018. On the same day, the plaintiffs and the defendant executed registered Sale Agreement for the said amount of Rs.20 lakhs vide document No.799 of 2018 and the same has been cancelled on 20.09.2018 vide document No.2898 of 2018. The defendant executed another registered Sale Agreement dated 20.09.2018 for an amount of Rs.20 lakhs vide document No.2899 of 2018.
11. Based on the pleadings between the parties, the Trial Court framed the following issues:-
(2) Whether the defendant executed the Sale Agreement for the amount received from the plaintiffs for borrowed amount ?
(3) Whether the defendant paid the borrowed amount with interest to the plaintiffs ?
(4) Whether the plaintiffs are entitled for Sale Deed from the defendant for the sale property ?
(5) Whether the plaintiffs are entitled for Rs.20 lakhs with interest at the rate of 12% from the defendant ?
(6) Any other relief is entitled by the plaintiff ?
12. On the side of the plaintiffs, PW-1
Specific performance denied for lack of continuous readiness proof and evidence of agreement as loan security.
The court clarifies that subsequent conduct indicating unwillingness to perform a contract negates entitlement for specific performance, necessitating a return of advance amounts instead.
The failure to prove the non-execution of a sale deed is detrimental to the appeallant's case.
The court can grant alternative relief of refund even if not explicitly claimed, ensuring fair justice is delivered in contract disputes.
The court ruled that mere proof of signature does not establish the execution of a sale agreement if fabrication is probable, thus denying specific performance.
In suits for specific performance, plaintiffs must prove the agreement's genuineness and continuous readiness to perform, particularly when execution is disputed.
Validity of the sale agreement and readiness of the plaintiff to perform the contract.
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