IMPORTANT POINT
Agreement to Sell – Readiness and Willingness – Conduct of the defendant can be seen only after the plaintiff is able to establish his case.

ANIL KSHETARPAL, J.

1. Defendants-appellants are in the regular second appeal against the judgment passed by the learned first appellate court, decreeing the suit for possession by way of specific performance of the agreement to sell dated 17.01.2005.

2. The substantial question of law arises for consideration:-

(i) Whether the discretion exercised by the learned trial court while refusing the specific performance of the agreement to sell and ordering refund can be interfered by the learned first appellate court without recording finding that the discretion exercised by the court is not based on sound judicial principles of law?

3. Plaintiff filed a suit for possession by way of specific performance of the agreement to sell dated 17.01.2005. It was pleaded that out of total sale consideration of Rs.1,35,00,000/-, Rs.10,00,000/- was paid as earnest money and the date for execution and registration of the sale deed was fixed as 15.06.2005. Plaintiff filed a suit on 14.01.2008.

4. Defendants contested the suit. In the written statement, it was pleaded that defendant no.1 drives tempo/auto rickshaw and for purchase of a mini bus, a loan of Rs.7,00,000/- was to be taken and in that context a security document i.e. agreement to sell was executed showing earnest money of Rs.10,00,000/-.

5. Learned trial court after appreciating the evidence available on the file, held that the agreement to sell and payment of earnest money is proved. However, learned trial court after taking into consideration that the suit has been filed after a period of 2 years and 6 months from the target date fixed for the execution and registration of the sale deed declined to grant relief of specific performance. Learned court further held that although, in the replication, plaintiff had pleaded that on the target date he went to the office of Sub-Registrar but no evidence was produced.

6. Learned trial court further noticed that the plaintiff did not produce on record any notice calling upon the defendants to come and execute the sale deed.

7. Learned first appellate court has chosen to reverse the aforesaid discretionary relief granted by the trial court by recording a finding that once the execution of the agreement to sell is denied, plaintiff is not required to prove his readiness and willingness. The first appellate court has further held that the grant of decree for specific performance of the agreement to sell is a rule, whereas denial thereof is an exception. Once the plaintiff has proved his readiness and willingness, the specific performance cannot be refused as defendant could not prove any hardship.

8. Now the stage is set to answer the question of law framed above.

QUESTION (i)

Whether the discretion exercised by the learned trial court while refusing the specific performance of the agreement to sell and ordering refund can be interfered by the learned first appellate court without recording finding that the discretion exercised by the court is not based on sound judicial principles of law?

9. It may be significant to note here that 15.06.2005 was the target date agreed upon by the parties for execution and registration of the sale deed. The suit came to be instituted on 14.01.2008. In the plaint, plaintiff pleaded that he was always ready and willing to perform his part of the contract. While pleading cause of action, plaintiff pleaded that the cause of action accrues to him on 17.01.2005 when the agreement to sell was executed and cause of action further accrued to the plaintiff when the defendants refused to perform their part of the contract. Plaintiff has not pleaded any positive step taken by him in order to show his readiness and willingness. In para 3 of the plaint, plaintiff pleads as under:-

“3. That the intentions of the defendants have now turned dishonest and they are not agreed to execute the sale deed in favour of the plaintiff as per terms of the agreement to sell dated 17.1.2005 as the rates of the properties have increased manifold