The court held that the agreement to sell was enforceable despite time not being the essence due to conditions of pending litigation and tenant eviction, affirming the plaintiff's continuous readiness to perform under the contract.

JUDGMENT :

DEEPAK GUPTA, J.

1. These Regular Second Appeals have been filed by the defendants against the judgment of reversal. The suit for specific performance, relating to the property in dispute, instituted by the plaintiff, Bhawani Dass (respondent No. 1 herein in both the appeals), against defendant N: 1 M/s Arlington Spinning & Weaving Mills Limited through its Director Shri Kamal Kishore Mehta (appellant in RSA No. 2177 of 2012), and another director - defendant No. 2 Vijay Mehta (appellant in RSA No. 2320 of 2012) was dismissed by the learned trial Court on 31.03.2011. However, plaintiff’s appeal was allowed by the learned Additional District Judge, Palwal, vide judgment dated 25.02.2012, thereby decreeing the suit for specific performance of the agreement to sell. Aggrieved thereby, the two defendants (Company and one its Director) have approached this Court by filing two separate appeals.

2. The trial Court record has been summoned and examined. For convenience and to avoid confusion, the parties are referred to in the manner they were arrayed before the trial Court.

3. Defendant No.1, M/s Arlington Spinning & Weaving Mills Limited (hereinafter “Arlington”), was admittedly the owner of land measuring 183 kanals 17 marlas situated in the revenue estate of Village Gudhrana, Tehsil Hodal, District Faridabad, detailed in Para N: 1 of the plaint.

4.1 Plaintiff’s Version : According to the plaintiff, the defendant Arlington, acting through its Director Sh. Kamal Kishore Mehta, entered into negotiations to sell the said land for a total sale consideration of Rs. 1,25,00,000/-. On 10.02.2005, the plaintiff paid an initial amount of Rs. 2,00,000/- as earnest money, and a writing (Yadasht) [Ex.P-1] to this effect was executed. It was agreed that a formal agreement to sell would be executed on or before 15.02.2005.

4.2 Thereafter, on 14.02.2005, a formal Agreement to Sell [Ex.P-2] was executed between the parties. On that day, Arlington received a further sum of Rs. 10,50,000/- vide a separate receipt. As per the agreed terms, an amount of Rs. 15,00,000/- was payable by the plaintiff on or before 15.03.2005, and the remaining balance was to be paid at the time of execution and registration of the sale deed.

4.3 The plaintiff asserts that in compliance with the Agreement, he paid another amount of Rs. 15,00,000/- to the defendants on 11.03.2005, for which a receipt [Ex.P-5] was issued by Sh. Kamal Kishore Mehta. Thus, up to 11.03.2005, an amount of Rs. 27,50,000/- had been paid by the paid as earnest money and also part of sale consideration. The parties mutually fixed 30.11.2005 as the tentative date for execution and registration of the sale deed.

4.4 It is the plaintiff’s specific case that time was not the essence of the contract. As per the terms of the agreement to sell, Arlington was obliged to execute the sale deed only after the decision of four pending civil cases relating to the suit land, and after getting the land vacated from the tenants, who were in possession of a portion of the land. As per plaintiff, he was told by Shri Kamal Kishore Mehta, the Director of the Company about pendency of four civil suits, in which stay against alienation were operating and assured to execute the sale deed in favour of the plaintiff after vacation of the stay orders by the Courts.

4.5 The plaintiff pleaded further that stay orders in the four civil suits were vacated on 10.04.2006, although the suits were still pending. Meanwhile, upon the asking of the defendants, the plaintiff paid yet another sum of Rs. 5,00,000/- on 13.07.2005 through cheque, regarding which defendant executed separate receipt [Ex.P-4]. Thus, in all, the plaintiff claims to have paid Rs. 32,50,000/- towards the sale consideration.

4.6 The plaintiff further asserted that though the tentative date for execution of the sale deed as 30.11.2005 was not the essence of the contract, he nonetheless remained ready and willing to perform his part of the contract and so, reached