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2022 Supreme(P&H) 292

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Arvind Singh Sangwan, J.
Anita G. Hawa – Appellant
Versus
Navtej Singh Bains – Respondent
RSA-1499-2013 (O&M) With RSA-4500-2013 (O&M)
Decided On : 25-08-2022

Advocates Appeared:
Mr. Ashish Aggarwal, Sr. Advocate with Ms. Aashna Aggarwal, Advocate, for the Appellant; Mr. Ashwani Kumar Chopra, Sr. Advocate with Mr. B.S. Nahar, Advocate and Ms. Gurpreet Kaur Bhatti, Advocate for the respondent, for the Respondent

Headnote:(A) Specific Relief Act, 1963 - Section 20 - Transfer of Property Act, 1882 - Contract Law - Suit for specific performance of an agreement to sell dismissed as time was held to be essence of the contract and the purchaser was not ready to perform his part. The trial court ruled that though the plaintiff was willing, he failed to prove readiness as he did not sign required forms for clearance. The appellate court's decree for specific performance was reversed due to lack of readiness and the original defendant's conduct. (Paras 46, 47)

Facts of the case:
The plaintiff had agreed to buy a property via an agreement dated 11.03.1998 by paying Rs.14.00 lacs as earnest money and failed to complete the sale process by not signing the required forms, leading to cancellation notices being issued from the defendant.

Findings of Court:
The plaintiff could not prove readiness to perform the contract; time was considered of the essence in the agreement as the defendant needed to sell the property before leaving the country. The trial court's judgment granting alternative relief of double the earnest money was upheld due to substantial price increases in the property market.

Issues: Main issues included whether the plaintiff was ready and willing to perform, if time was critical, and if the suit was maintainable after cancellation by the defendant.

Ratio Decidendi: The court found that failure to comply with necessary requirements and deadlines indicates a lack of readiness; hence, the relief of specific performance by the appellate court was erroneous. The trial court's dismissal of specific performance was upheld as reasonable and equitable under the prevailing circumstances.

Result: RSA No. 1499 of 2013 allowed; lower appellate court decree set aside in favor of the original trial court ruling.

Table of Content
1. challenges against decree of specific performance (Para 1 , 2)
2. non-performance and reasons for dispute (Para 5 , 6)
3. court's discretion in decreeing specific performance (Para 12 , 13 , 40)
4. evidence of communication related to agreement (Para 15 , 16 , 17)
5. final findings and conclusions on performance and compensation (Para 46 , 48)

JUDGMENT

Arvind Singh Sangwan, J. (Oral). - Challenge in RSA-1499-2013 is to the judgment and decree dated 16.07.2009 passed by the trial Court, vide which C.S. No.105 dated 30.07.1998 filed by the plaintiff was partly decreed, while denying the relief of specific performance of agreement to sell, the respondent-plaintiff was held entitled to damage to the tune of Rs.28.00 lacs along with interest @6% per annum from the date of institution of the suit i.e. 30.07.1998 till the date of actual payment, with costs of the suit as well as judgment and decree dated 01.02.2013 passed in C.A. No.210 dated 23.07.2009 filed by the respondent-plaintiff, challenging the findings of the trial Court, declining to grant the relief of specific performance, was allowed and the suit was decreed by granting a decree of specific performance of agreement to sell.

2. Challenge in RSA-4500-2013 is to set aside the judgment and decree passed by the lower appellate Court dated 01.02.2013, vide which CA No.234 dated 13.08.2009 filed by the appellant-defendant qua partly decreeing the suit, was dismissed Brief facts of the case are that the appellant-defendant, vide agreement to sell dated 11.03.1998 qua her House No.96, Sector-8A, Chandigarh, agreed to sell it to the plaintiff for a total sale consideration of Rs.1.25 crores with a rider that if the entire sale is completed on or before 15.04.1998 i.e. two months prior to stipulated date, on the basis of power of attorney, the sale consideration will be reduced to Rs.1.10 crores, else, the sale deed was to be executed on completion of certain terms and conditions incorporated in the agreement to sell. Rs.2.00 lacs were paid as token money against a formal receipt and another amount of Rs.12.00 lacs was paid as additional amount on 11.03.1998, which was also acknowledged by the defendant vide a separate receipt executed on back of first page of the agreement to sell dated 11.03.1998.

3. Since terms and conditions of the agreement to sell are heavily relied upon by both the parties, it is relevant to reproduce the same as below: -

      '1. That the total sale price of the above said property, house and plot has been fixed at Rs.1,25,00,000/- (Rupees One Crore and Twenty Five lacs only).

      2. That the said purchaser had paid to the said seller a sum of Rs.14,00000/- (Rupees Fourteen Lacs only) i.e. Rs.2,00000/- (Rupees Two Lacs only) vide Bank Cheque No.308641 dated 26.02.1998 issued on Ban of Punjab Sector \-35 and Rs.12,00000/- (Rupees Twelve Lacs only) vide Pay Order No.358990 dt. 7.3.98 for Rs.12 lacs issued on Bank of Punjab, Sector-35, Chandigarh, i.e. The said amount is i.e. 10% as earnest money alongwith over One lac extra as a part payment towards the cost of the said house. The said payment has been made in favour of Mrs. Prem Hawa, for which amount the said seller hereby acknowledges the receipt in presence of marginal witnesses and the receipt of the same is given on this Agreement to Sell.

      3. That the said seller will clear all outstanding dues against the said plot and house and will get no due certificate and Permission to Sell the said house from the Estate Officer, Chandigarh alongwith clearance from the concerned Income Tax Office and handover the same to the purchaser on receipt of full payment and on day of registration of the said house. The seller will also inform Shri Navtej Singh Bains, as well as to Chandigarh property Consultant, regarding receipt of said NOC, minimum 10 days before the last date of execution of sale deed, for his necessary action for making balance full payment.

      4. The seller has agreed to sell the said house i.e. House No.

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