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GUJARAT HIGH COURT
S.H. Vora, J.
Sanjay Kumar Thakorbhai Naik —Appellant
versus
Naversusari Oil Products Pvt. Ltd.
Co. & Ors. —Respondents
Appeal From Order No.208 of 2013,
Decided on 05.09.2013
For the Appellant:Mr. S.N. Shelat, Mr. Pranav S. Dave, Mr. Shivang M. Shah, Advocates.
For the Respondent:Mr. Mohit Joshi, Mr. Nanavati Associates, Advocates..
IMPORTANT POINT
Time being essence of contract cannot be violated by plaintiff.
Headnote:(A) Specific Relief Act, 1963—Sections 10 and 14(1)(c)—Specific performance of contract—Readiness and willingness is condition precedent to grant relief both at final stage or even at interlocutory stage in order to succeed in suit for specific performance—Plaintiff needs to show that he has sufficient fund for payment—Normally, in contract relating to immovable property, time cannot be essence of contract and time stipulated for performance even if expressly read and shown to be essence requires to be read as not being essence of contract and consequently, contract relating immovable property does not become terminable by failure to perform before specified time—Presently, there is clear intention making time essence of contract for payment of balance price—Sale deed was to be executed only after payment of complete sale consideration on or before date specified—Plaintiff investigated right, title or interest of defendants and thereafter, plaintiff found himself satisfied that suit property is clear and marketable and that there are no encumbrances on suit property—Time regarding payment of balance price was essence of contract and such payment was not dependent upon purchaser’s satisfaction regarding title—Plaintiff failed to pay balance sale price on or before specified date—Appeal dismissed. (Paras 14 to 22)
(B) Civil Procedure Code, 1908—Order 43 Rule 1(r) read with Order 39 Rules 1 and 2—Appeal—Scope and ambit—Suit for injunction—Court is not required to go into merits of entire matter at this stage and what is required to be seen is whether appellant-original plaintiff has made out a prima facie case or not for grant of interim injunction—Appellate Court may not interfere with exercise of discretion of Court at first instance and substitute its own discretion except when discretion has been shown to have been exercised arbitrarily, capriciously or perversely or when Court has ignored settled principles of law regulating grant or refusal of interlocutory injunctions—Appellate Court cannot reassess material and reach a conclusion different from one reached by Court. (Para 19)
Result: Appeal dismissed.
S.H. Vora, J.—Challenge in present Appeal preferred under Order 43, Rule 1(r) read with Section 104 of the Civil Procedure Code (For short “CPC”), is the order dated 29.04.2013 passed in Special Civil Suit No.73 of 2012 passed by the learned Principal Senior Civil Judge, Navsari, wherein pending hearing of the suit for the specific performance based upon agreement dated 06.08.2012 in favour of the plaintiff - appellant in respect of the land property admeasuring 2-21-57 HRA Sq. Mtr. situated at Survey No.239/1 and Survey No.239/2 in the area of village: Vijalpore, Tal. Jalalpore, Dist. Navsari (now, it would be referred to as “suit property”), prayed to restrain the respondents from transferring, assigning, leasing, mortgaging or transferring in any manner and further to prevent from making any construction or to change the identity of the suit property till final disposal of the suit. Parties to the present proceedings would be referred to as per their status before the trial Court.
2. Brief facts leading to the present Appeal can be stated thus:
2.1 It is the case of the plaintiff that the defendants agreed to sell the suit property for total consideration of Rs.31 Crores. Out of which Rs.5.65 Crores was paid by the plaintiff and same was acknowledged by the defendants in agreement dated 06.08.2012 in clause 4 thereof. It is the say of the plaintiff that earlier agreement/MOU dated 19.04.2012 was executed, which was cancelled by consent and fresh agreement dated 06.08.2012 came to be executed (now, it would be referred to as “suit agreement”). It is the case of the plaintiff that first agreement dated 16.04.2012 was entered into between the parties for total consideration of Rs.21 Crores. According to the said agreement, it was agreed between the parties to the suit that if plaintiff fails to pay consideration before extended period, on 15.06.2012, the defendants would have right to sell suit property to any third party. It is case of the plaintiff that as the defendants could not determine the lease in favour of VVF. Industries, the said agreement was not materialized and therefore, the plaintiff did not pay the said consideration of Rs.21 Crores and therefore, the parties to the suit were compelled to execute the suit agreement dated 06.08.2012. Vide suit agreement dated 06.08.2012, total price of the suit land was raised from Rs. 21 Crores to Rs. 31 Crores. It is one of the term in the agreement that the defendants will have to pay total consideration by 30.09.2012 and if the sale price is paid by 31.08.2012, then the plaintiff would be given discount ofRs.50 Lacs from the total price i. e, Rs. 31 Crores and if the plaintiff does not pay by 31.08.2012, the sale price of Rs.31 Crores was to be paid by 30.09.2012. It is also case of the plaintiff that the defendants agreed that the earnest money paid to the defendants towards part payment of sale price will be kept separately by the defendants and will not be used or disposed off elsewhere to its business until deal is completed.
2.2 In response to the summons/notice by the trial Court, the defendants filed its reply below Exhibit 22 and by application Exhibit 25, the defendants applied for depositing earnest money into the Court received under the suit agreement from the plaintiff, which appears to have been rejected by the trial Court. After narrating various facts leading to the transaction in question, it is specific case of the defendants that on reading of the suit agreement, it is crystal clear that time was essence of the contract and such intention is evident from the express terms set out in the suit agreement.
3. Learned senior counsel Mr. S.N. Shelat for learned advocate Mr. S.M. Shah appearing on behalf of the appellant submits that the learned trial Court has failed to appreciate the provisions contained in Section 14(1)(c) and Section 10 of the Specific Relief Act (now, for short “Act”). It is submitted that Section 10 of the Act provides that normall
