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1957 Supreme(MP) 104

High Court Of Madhya Pradesh
V. R. Sen and T. C. Shrivastava, JJ.
PT.KRISHNA CHANDRA SHARMA - Appellant
Versus
PT.RAMGULAM - Respondents
First Appeal 25 Of 1951
Decided On : 04/19/1957

Advocates Appeared:
B.L.SETH, R.S.DABIR, R.S.SHARMA, S.L.JAIN

In the case of agreements to reconvey, time is of the essence of the contract and the contract must be performed within the stipulated period.

Headnote:

SPECIFIC PERFORMANCE - SALE WITH AGREEMENT TO RECONVEY - TIME OF THE ESSENCE - TENDER AFTER STIPULATED PERIOD - WHETHER VALID - GENERAL CLAUSES ACT, SECTION 10 - APPLICABILITY.

Fact of the Case:

Plaintiffs executed a sale deed in favor of defendants for Rs. 7,262/8/- on 1st February, 1949, with an agreement to reconvey the property if the amount was paid by 1st July, 1949. Plaintiffs claimed to redeem the mortgage or enforce specific performance of the contract to reconvey the plot.

Finding of the Court:

The court found that the plaintiffs did not make any tender of the amount on or before 1st July, 1949, and that time was of the essence of the contract. The court also held that the plaintiffs were not entitled to the benefit of the fact that 1st July, 1949 was a Bank holiday.

Issues: 1. Whether the transaction amounted to a mortgage by conditional sale or a lending and borrowing transaction? 2. Whether time was of the essence of the contract? 3. Whether the plaintiffs were entitled to the benefit of the fact that 1st July, 1949 was a Bank holiday?

Ratio Decidendi: 1. The court held that the transaction was not a mortgage by conditional sale as the sale and the conditions of reconveyance were not embodied in the same document. 2. The court held that time was of the essence of the contract as the agreement to reconvey was a concession given to the plaintiffs and there was no mutuality in the contract. 3. The court held that the plaintiffs were not entitled to the benefit of the fact that 1st July, 1949 was a Bank holiday as they could have completed the execution of the deed of reconveyance and registered it later.

Final Decision: The appeal was dismissed with costs.

( 1 ) THIS appeal has been filed by the plaintiffs against the decision of the Civil judge Class I, Sagar, in Civil Suit No. 13-A of 1950.

( 2 ) THE plaintiffs had executed a sale-deed on 1st February, 1949 (Ex. P-5) in respect of their Malik Makbuza plot No. 46/1 situated at Khurai town for Rs. 7,262/8/- which consisted of Rs. 5,000/- paid on 1st February, 1949, Rs. 2,000/paid on 4th February, 1949 and Rs. 262/8/- future interest for five months in advance. On the same date, the defendants executed an agreement (Ex. P-6)agreeing that 'they would reconvey the plot to the plaintiffs if an amount of Rs. 7275/'- was paid by them at any time up to 1st July, 1949. The plaintiffs stated that on 24th June, 1949, 29th June 3949 and 1st July, 1949, they offered to pay the defendants the agreed amount but the defendants put oil executing reconveyance on various excuses. On 2nd July, 1949, the defendant No. 1 met the plaintiff No. 1 in the BarLibrary, at Khurai and promised to execute a sale-deed it the amount was produced in cash. When the amount was produced, the defendant no. 1 slipped away and avoided to execute a sale-deed. The plaintiffs had pleaded that the transaction amounted to a mortgage by conditional sale and although the period fixed for payment expired on 1st July, 1949 that day being a holiday, the amount could be paid on 2nd July, 1949. At any rate, the plaintiffs stated that time was not of the essence of the contract and, therefore, they could repay the amount with a reasonable time which they had always been prepared to do. They accordingly claimed to redeem the mortgage or in the alternative to enforce specific performance of the contract to reconvey the plot.

( 3 ) THE defendants denied that the plaintiffs had made any offer to pay the sum in the last week of June or on 1st July, 1949 as alleged. They dented that any offer was made on 2nd July, 1949 in Khurai Bar Library. They pleaded that as the time fixed for the repayment had expired, the right o[ the plaintiffs to ask for reconveyance had lapsed.

( 4 ) THE trial Court has found :

(i) that the alleged tender of the amount has not been proved as also the alleged agreement to accept the amount on 2-7-1949. (ii) that the defendants did not avoid to exe cute a reconveyance as alleged. (iii) that time was the essence of the contract and the plaintiffs could not claim a reconveyance after they failed to tender the amount before the stipulated date. (iv) that the plaintiffs were not entitled to tender the amount of 2-71949 on the ground that 1-7-1949 was declared a holiday. On these findings, the trial could held that the plaintiffs were not entitled to specific performance and dismissed the suit. Hence this appeal.

( 5 ) THE first point to be decided in this appeal is a question of fact viz. whether any tender or the amount was made by the plaintiffs on 24th June, 1949, 29th june, 1949, or 1st July, 1949. (After discussion of the evidence the judgment proceeds :) We have examined the evidence adduced carefully and find ourselves in full agreement with the conclusions reached by the trial Court. The probabilities as discussed in the judgment of the trial Court are that the plaintiffs never had the amount ready with them and the story about offering of the amount to the defendants on 29th June, 1949 and 1st July, 1949, is false.

( 6 ) PASSING on to the incidents which happened, on 2nd of July, 1949 in the Bar room at Khurai, we have the evidence of Shri Ram Narain Lal (P. W. 9) Shri V. V. Sapro (P. W. 6), Shri S. P. Choubey (D. W. 4), Shri L. S. Khare (D. W. 1) and the plaintiff No. 1 himself. (After discussion of evidence of these witnesses the judgment proceeded : )

( 7 ) CONSIDERING the evidence on record, we are of the view, that the amount which was produced in the Bar-room that after-noon did not belong to the plaintiff and was not really meant for payment. We do not find it proved, that any offer was made by the defendant No. 1 to execute a deed of reconveyance if t














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